However, after the country plunged into the deepest recession on record in the three months ending in June, companies began shedding jobs at a faster rate than during the global financial crisis of 2008, with hundreds of thousands of layoffs announced in recent weeks alone. .Raising the alarm as the UK government prepares to cut its job retention program on leave this fall, Frances O’Grady, chief executive of TUC, warned that continued support would be needed to avoid a employment disaster and long-term damage to the economy. .
Writing in The Guardian, she said: “Without urgent action, we face the prospect of mass unemployment on a scale not seen since the 1980s.”
Appealing to Chancellor Rishi Sunak, she said: “There is still time to end mass unemployment. We already worked together at the start of this crisis: I will work with you again if you are serious about stemming the bleeding of jobs.
The Guardian chose eight economic indicators, along with the FTSE 100 level, to track the employment and growth impact of Covid-19 and the metrics used to contain it. In the face of the deepest global recession since the Great Depression of the 1930s, the Covid Crisis watch will also monitor the situation in the UK relative to other countries.
Over the past month, private sector business activity has grown at the fastest pace in seven years, with companies rushing to catch up with work suspended during the lockdown. Rising demand for services and manufactured goods, which followed the easing of restrictions over the summer, pushed the IHS Markit CIPS flash UK composite index to 60.3 in August, from 57 in July. On a scale where a figure above 50 indicates expansion, the latest figures suggest the UK is recovering faster than the US, China and the Eurozone.
The recovery comes after Britain was officially confirmed to be in the deepest recession since modern records began in the 1950s, with gross domestic product (GDP) falling 20.4% in the second quarter.
In the deepest decline of any G7 country and the EU, the crisis has been made worse by the subsequent launch of the lockdown and the prolonged use of controls to limit the spread of the virus. Due to Britain’s deeper recession, non-essential stores were closed for just 50 days in Germany, compared to 84 days in the UK.
Retail sales topped pre-pandemic levels in July in the first full month since restrictions were eased, as shoppers gradually returned to the high streets. The hospitality industry has also been shot in the arm of the “eat out to help” program, with a Monday-Wednesday boom in restaurants, pubs and cafes in August. More than 64 million discounted meals – the equivalent of one for almost every person in Britain – have so far been claimed by establishments participating in the scheme.
However, significant pressure remains on business, threatening a sharp rise in unemployment this fall. Online spending remains higher than before the onset of the crisis, footfall remains on the decline in several major cities due to the continued absence of office workers, and demand remains weak in some sectors more dependent on interactions social or travel, such as entertainment, aviation and tourism.
Millions of workers have been brought back from leave as companies gradually reopen with physical distancing measures in place, with the total number of people benefiting from the government’s wage subsidy program rising from a high of around 9 million in May to around 4.5 million at the start of August.
However, more than half of the workforce in the arts, entertainment and recreation industry remains on leave, compared with just 13% still absent from work for the economy as a whole, according to the Office for National Statistics.
Despite the government program protecting millions of jobs, official figures show nearly three-quarters of a million jobs have been cut from companies’ payrolls since March. Economists say unemployment is expected to more than double as the government cancels the holiday program this fall and businesses cut costs amid falling demand, while Covid-19 remains a health risk.
Having warned that the crisis is far from over, O’Grady said employers would need continued government support to protect jobs and create new ones as the risks of the pandemic gradually diminish.
“Mass unemployment is not inevitable. If the government acts quickly to keep people working, our economy will recover faster and our country will be able to rebuild better, ”she said.