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Employment

One in seven workers are job-hunting amid fears of looming employment crisis

New research from the Resolution Foundation paints a stark picture of the UK’s employment crisis ahead of March’s spring budget.

One in seven workers are already looking for a new job, new research has shown, amid growing concerns about the UK’s economic recovery from the pandemic and the end of the furlough scheme in April. 

The latest report by the Resolution Foundation highlights the ongoing impact of Covid-19 on the labour market and the policy changes needed to ensure a “strong recovery”. 

Nearly 40 per cent of workers between 18 and 24 are either looking for another job or plan to start looking in the next three months, and more than a third of BAME workers are job-hunting or plan to, compared to a quarter of white workers.

“Although the labour market effects of this lockdown are less pronounced than those of the lockdown that came into force last spring, the same groups have been worst affected,” wrote the report’s authors.

“The young (and to some extent older workers), those in low paid work, the self-employed and those employees with ‘atypical’ contracts continue to bear the brunt of job loss and furlough – with most of these effects being driven by the fact that these groups are more likely to work in sectors that are shut down or under social distancing restrictions, like leisure and hospitality.”

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The survey of nearly 5,000 people was the third such report undertaken by the Resolution Foundation during the pandemic.

Figures from the Resolution Foundation show a total of 1.9 million people have spent the last six months either unemployed or on furlough as part of the government Job Retention Scheme (JRS).

The decision to extend the JRS at the end of last year increased the number of furloughed workers from 4 million in December to 4.5 million in January. However, this represents only half of the 9 million people who were furloughed during the first lockdown.

The impact of Covid-19  has contributed to rising levels of unemployment and concerns surround job security. So far, 7 per cent of those in employment before the pandemic have stopped working, with more job losses expected in the near future. 

“Getting labour market policy right, and ensuring it’s alive to the state of the pandemic, will be central to avoiding an unemployment crisis with deeply damaging effects for living standards and long-run productivity,” continued the authors. “Now is the time to get those policies in order.“

With the March budget just two weeks away, pressure is mounting on Chancellor Rishi Sunak to offer more support to those who are bearing the brunt of the pandemic’s economic effects.

On Thursday Labour leader Sir Keir Starmer announced his party’s vision for a long-term recovery plan which would allow savers to play a role by investing in businesses and communities. 

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The Resolution Foundation warned of long-term unemployment having a “scarring” effect on workers who lose skills and are treated negatively by employers because of the stigma of unemployment.

Among those most concerned are workers who have been unemployed for more than six months. More than half of this group do not think they will find a job within the next year.

Furloughed workers are slightly more optimistic, with only 14 per cent sharing the same fears.

According to the Resolution Foundation,  the Government must now take into consideration the “duration” of the impact of Covid-19 and ensure that policies “strengthen the recovery” of the job market. 

In order to prevent any further deterioration, ministers must “pursue arange of policies to promote hiring, job creation, and to facilitate career changes where that is appropriate,” the authors added.

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