- May to July figures show an increase in the unemployment rate; despite this increase and an increase in the number of redundancies, the employment rate is still not falling.
- Though still large, the reductions in total hours worked both on the year and the quarter are smaller than last month, with the May to July period covering a time when some of the coronavirus (COVID-19) lockdown measures started to be eased.
- Early estimates for August 2020 from Pay As You Earn (PAYE) Real Time Information (RTI) indicate that the number of payroll employees fell by 2.4% (695,000) compared with March 2020.
- The Claimant Count increased in August 2020, reaching 2.7 million; this includes both those working with low income or hours and those who are not working.
- Vacancies in the UK in June to August 2020 were at an estimated 434,000; this is almost 30% higher than the record low in April to June 2020.
- The rate of decline in employee pay growth slowed in July following strong falls in the previous three months; growth has been affected by lower pay for furloughed employees and reduced bonuses; with some employees returning to work, nominal regular pay growth is back positive for May to July 2020 after being negative in the three months to June 2020.
Commenting on the ONS labour market figures for September 2020, published today, BCC Head of Economics Suren Thiru said:
“Despite the slight rise in the unemployment rate, the furlough scheme continues to limit the pandemic’s full impact on headline job figures.
However, the decline in employees on payrolls and the rise in the claimant count in August as the furlough scheme began to taper is a clear warning that the full impact of Coronavirus on the UK labour market is yet to come.
While there was a rise in the number of job vacancies, this is more likely to reflect a temporary bounce as the economy gradually opened, rather than a meaningful upturn in demand for labour. With many firms are still facing waves of cash flow problems, rising costs and an uncertain economic outlook, it is probable that unemployment will escalate sharply as government support winds down.
To help avoid a damaging cliff edge for jobs more must be done help firms keep staff on through this deeply challenging period. This should include a significant cut in employer National Insurance Contributions and more substantial support for firms placed under local lockdowns.”