Number of workers on furlough plunged by two million between May and June but the Government scheme is still supporting millions two months before it ends, says new study
- A study by The Resolution Foundation found 8.9 million workers were furloughed
- This fell to 6.8 million by the end of June with numbers continuing to plummet
- The Job Retention Scheme will end in October increasing fears of job losses
The number of furloughed workers has fallen sharply since early May, according to a new study.
But the Government’s scheme is still supporting millions of employees despite furlough numbers plummeting by a quarter between May and June.
The Resolution Foundation said the number of furloughed workers peaked at 8.9 million in early May, falling to 6.8 million by the end of June.
The number of fully furloughed workers continued to fall sharply between March and June, pictured in the graph above, as the economy continued to reopen and partial furloughing was introduced
The Resolution Foundation said Chancellor Rishi Sunak, pictured, should focus the scheme on helping the hardest-hit sectors and should subsidise the wages of those returning to work
The number of fully furloughed workers continued to fall sharply in July and August, as the economy continued to reopen and partial furloughing was introduced.
The latest data from the Office for National Statistics (ONS) up to the beginning of August said 12% of the workforce are still on furlough.
However there are fears that there will be an increase in job losses after the Job Retention Scheme (JRS) ends in October.
The Resolution Foundation said its study highlighted how sectors such as hospitality had been hardest hit.
The think tank said 96% of pubs and similar companies make use of the JRS, compared with just 9% of non-specialised retail stores such as supermarkets.
Rather than ending the JRS altogether, or maintaining it in its current form after October, the Chancellor should focus the scheme on hardest-hit sectors, the Foundation said.
This would make sure the Government subsidises the wages of those returning to work, rather than staying off.
The Resolution Foundation said the number of furloughed workers peaked at 8.9 million in early May, falling to 6.8 million by the end of June and continuing to fall in July and August
Nye Cominetti, senior economist at the Resolution Foundation, said: ‘The Job Retention Scheme has played a critical role in protecting firms and workers from the worst of the economic crisis.’
He said almost ‘nine million workers’ were furloughed at the peak in early May.
He added: ‘The good news is that the number of fully furloughed workers has fallen substantially since early May as the economy has gradually reopened.
Mr Cominetti said that ‘6.8 million workers were still furloughed at the end of June’ despite ‘hard-hit sectors such as hospitality’ operating below capacity.
This highlights ‘the scale of redundancy risks workers face as the scheme is wound down by the end of October,’ he said.
The Government’s scheme is still supporting millions of employees despite furlough numbers plummeting by a quarter between May and June