Unemployment jumps 649,000 since lockdown with 74,000 extra jobs claimed by coronavirus last month

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UNEMPLOYMENT has risen by 649,000 workers since lockdown with the coronavirus crisis claiming an 74,000 extra jobs last month.

The number of paid employees fell by 1.9 per cent year on year in June to 28.4million, and by 0.3 per cent compared with the previous month, the Office for National Statistics (ONS) said.

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The number of people claiming work-related benefits such as Universal Credit, including those on low incomes, was 2.6million.

This figure has more than doubled since March – soaring 112.2 per cent or by 1.4 million – in a sign of the mounting jobs crisis.

With 9.4 million people on furlough classed as employed, the true coronavirus impact on jobs is only expected to show after the scheme ends in October.

It comes after the Office for Budget Responsibility (OBR) this week predicted that unemployment is set to hit 12 per cent this year as the furlough scheme winds down.

This would affect 3million people, up from 1.3million in 2019.

In just one day in July, more than 12,000 jobs were put at risk by firms including Upper Crust, easyJet and Airbus.

For the Brits who are employed, wage growth has slowed and median monthly pay fell by 0.9 per cent to £1,795 in May compared to the same month last year, according to the ONS.

The figures show that vacancies fell 463,000 between March and May to a record low of 333,000 as companies froze hiring in the face of the pandemic.

Jonathan Athow, deputy national statistician at ONS, said: “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.

“There are now almost two-thirds of a million fewer employees on the payroll than before the lockdown, according to the latest tax data.

“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: “There are now far more out-of-work people who are not looking for a job than before the pandemic.”

Sara Willcocks, head of communications at poverty charity Turn2us, said: “It is now clear that we are heading for an intense period of high unemployment.

“Without intervention this will lead to mass personal debt, rising homelessness and increasing numbers of families going hungry.

“Whether you are losing your job on a London high-street, or in a tourist town like Blackpool, it is vital that you are not left to sink into poverty.

“The government introduced the furlough scheme to help millions of people keep their jobs at the height of the pandemic; they must now double down to protect people through the second phase of this crisis.

“We urge the DWP to increase social security spending, eliminate the five week wait for Universal Credit and ensure that benefit conditionality is flexible to claimant’s needs and opportunities in their area.”

Mims Davies, minister for employment, said: “We know that people are worried about their livelihoods which is why we’ve put in place a Plan for Jobs.

“A crucial part of that is doubling the number of frontline work coaches so that every jobseeker gets support to find work as well as launching the Kickstart scheme to create hundreds of thousands of new, fully subsidised jobs for young people across the country.”

Business Secretary Alok Sharma also defended the government’s £160billion support schemes this morning and told BBC Breakfast: “If we hadn’t provided this support, we would’ve been in a far worse position.

“The cost of inaction would’ve been far greater than the cost of action.

He added: “Anyone who’s facing unemployment, it’s going to be an incredibly worrying time.

“We want to reach out and support everyone through our Jobcentre networks.

“What we need to do now is to continue open up the economy in a careful and phased way.”

Employees face the first wave of redundancies ahead of changes to the Coronavirus Jobs Retention Scheme (CJRS) in August, which sees employers chip in to pay for National Insurance and pension contributions for furloughed staff.

From September, the government’s contribution will fall to 70 per cent of wages up to a cap of £2,187.50 a month.

In the mini-Budget last week, Chancellor Rishi Sunak announced a £1,000 bonus per furloughed employee that businesses re-employ.

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