Official figures revealed on Thursday showed that almost 650,000 people lost their jobs during lockdown held between March and June.
Whilst the government’s furlough scheme kept the number lower than feared, the number of people who have lost their jobs is expected to grow when the scheme ends in October.
“Our official data is failing to show the true extent of this jobs crisis,” said Mike Brewer, chief economist at the Resolution Foundation think tank, which has predicted millions of total job losses by the end of the year.
As well as the number of people off the payroll, the number of hours worked in the UK also plummeted over lockdown. Weekly hours worked between March and May fell to 877.1 million hours. the largest annual decrease since estimates began in 1971.
“These figures show serious difficulties for hundreds of thousands of people, but unfortunately this is still only the beginning of the impact on the labour market. Flattening the unemployment curve will remain paramount,” said Matthew Percival, director for people and skills at the CBI.
Job vacancies are currently at a lower-than-normal rate during the pandemic. ONS deputy national statistician Jonathan Athow explains: “As the pandemic took hold, the labour market weakened markedly. But that rate of decline slowed into June, though this is before recent reports of job losses.”
“The labour force survey is showing only a small fall in employment, but shows a large number of people who report working no hours and getting no pay,” he added.
A new survey from the British Chambers of Commerce (BCC) has found that of 7,400 businesses they surveyed, 29% plan to make job cuts over the next three months as the furlough scheme comes to an end.
The furlough scheme will wind down in October. So far, 1.2m companies have benefitted from the scheme where the government pays 80% of employees’ salaries.
