In April, unemployment in the UK remained steady month on month at 3.9 per cent. In May, roughly 600,000 fewer Brits were on company payrolls than the previous month. These two starkly contrasting indicators of employment reflect the painfully blurred economic outlook of a country stumbling back to its feet in the wake of an unprecedented shock.
Britain’s labour market is in a state of “suspended animation” thanks to the government’s job retention scheme, according to Samuel Tombs at think-tank Pantheon Macroeconomics. Furloughed staff – 9m of them at the last count – are neither employed nor unemployed and the true impact of coronavirus on the jobs market will only become clear once the scheme is removed.
Still, the fact that employment has remained near its all-time high at 76.4 per cent in a period where the UK’s economic output has fallen 5 per cent year on year, is credit to the furlough scheme. True to its word, the government has protected jobs during the worst of the lockdown, meaning companies have staff on hand to help them reopen as lockdown eases.