In March 2020, the whole world was thrown into uncertainty, with no one knowing how long the pandemic would last, or what the employment market would look like going forward. Predictions were made, with many negative forecasts about what would happen when the governments furlough scheme came to an end. Despite the gloomy guesses, the end of the job retention scheme has actually had little effect on the unemployment figures – so why is that?
At its peak almost 9 million jobs were on the furlough scheme in May 2020, and the government reports that 11.6 million jobs have been supported. At the beginning of the scheme it was feared that more than one in ten workers would become unemployed, but in September 2021 the unemployment rate was less than one in twenty. When the scheme came to a close, the numbers had dwindled from 9 million, to 1.1 million. The Office for National Statistics has reported that survey responses indicate that of those still on furlough at the end of October, there have only been a small number of redundancies made. There is no doubt that the furlough scheme has helped to sustain the UK employment market.
Over the past year there has been a huge rise in job vacancies, reaching the highest level since records began in 2001. Those who found themselves redundant when the furlough scheme ended were met with a record high in job vacancies, so those looking for work were able to find it. The ONS reports that from September to October there was a further 160,000 payrolled employees. In fact, payrolled worker numbers are well above pre-pandemic levels, up 235,000 since February 2020. This increase in employment was propelled by a record high flow from unemployment to employment, with job to job moves also at an all time high. There has been a surge in the numbers of those leaving roles for other jobs, ones that pay better or are more flexible around their lives, rather than due to redundancy.
However, Sam Beckett Head of Economic statistics at the ONS warns that it may take time to see the full impact of the furlough scheme ending. “It might take a few months to see the full impact of furlough coming to an end, as people who lost their jobs at the end of September could still be receiving redundancy pay. However, October’s early estimate shows the number of people on the payroll rose strongly on the month and stands well above its pre-pandemic level.”
The employment market is still desperate for new talent, and we are discussing a climate in which employers are looking to retain staff rather than let them go. At Plus One, we have witnessed first hand how candidates are using this market to ask for not just more money, but better a work life balance as well. If you are looking to recruit, it is important to listen to what the climate is saying, and make concessions to your staff and interviewees