One in three UK businesses expect to make job cuts by October, according to a new poll that shows the effects of the coronavirus on the economy are beginning to accelerate.
Around 33% of more than 2,000 businesses surveyed said they expected to make redundancies in the third quarter of this year, according to figures from the Chartered Institute of Personnel and Development (CIPD) and Adecco Group, a staffing company.
The survey suggests that the UK is likely to experience a spike in job losses as the government’s coronavirus job retention furlough scheme is withdrawn.
The scheme, introduced at the beginning of lockdown, saw the government originally pay for 80% of furloughed workers’ wages up to £2,500 per month, preventing many job losses.
However, from this month the government is making businesses with furloughed workers contribute a higher percentage of their wages, and the scheme is due to end completely in October.
CIPD’s senior labour market adviser Gerwyn Davis said: “Until now, redundancies have been low – no doubt due to the job retention scheme – but we expect to see more redundancies come through this autumn, especially in the private sector, once the scheme closes.”
The retail sector has already been hit particularly hard by job losses, with well over 15,000 jobs being lost since April.
Hospitality, too, has suffered, with a number of large high street chains such as Carluccio’s, Bella Italia and Byron all collapsing.
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