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01/08/2021

Pandemic Amplifies Mass Redundancies in the United Kingdom

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New unemployment figures show that unemployment has more than doubled in the two counties of Devon and Cornwall. Figures compiled in November 2020 when compared with pre-COVID November 2019 show that:

  • Universal Credit or UC and Jobseekers Allowance or JSA claimants in Devon have increased by 138% to stand at a figure of 36,532
  • Cornwall showed a 118% increase to stand at 18,491
  • In Plymouth, a part of Devon, these figures stand at 10,283 showing an 86% increase

The UK has seen 830,000 people becoming redundant during the COVID-19 pandemic. This is the highest unemployment figure in 4 years. Experts indicate that these figures will increase further as the labor market starts experiencing the pain of the current lockdown. 

This shocking unemployment situation, a direct result of nationwide lockdowns and restrictions, is prevalent in almost all economic sectors.

However, some sectors like hospitality, retail, construction, care, and security have fared quite well by either operating online or providing takeaway services. Supermarkets too have remained busy. Ironically, some jobs and vacancies were also created because of this pandemic. The Government’s decision to extend its furlough scheme till April 2021 has done little to cushion the blow on unemployment. There was a slight increase of 0.2% in the month of November and December 2020 but there is still no cause for cheer. The overall claimant count, including people who are unemployed and those with exceptionally low income and work hours, went up by 0.3% to reach 2.6million in December 2020.  

After witnessing a slight drop in September 2020, the national redundancy rates soared to a record high of 395,000 in November from about 168,000 in September. The early vacancy recovery also slowed to about half the growth level of the previous months.

Business leaders have reached out to Chancellor Rishi Sunak to ask for further support measures in sectors that have been the worst hit by the pandemic. The latest lockdown will further result in job redundancy as companies and firms with already troubled balance sheets come under further pressure. Thus, the COVID-19 economic support schemes and Job Retention schemes need to be extended beyond April to support unemployment.

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