Now that the government's furlough scheme is over, our personal finance expert comments on its impact and what happens next.
The Office for National Statistics (ONS) has today released data providing an overview of workers who were furloughed.
Commenting, Myron Jobson, Personal Finance Campaigner, interactive investor, says: “The furlough scheme was a lifeline for millions of UK workers during the pandemic and while many good things have to come to an end eventually, it does so at an uncertain time.
“The rise in the cost of living exacerbates matters, with the Bank of England forecasting inflation to reach 4% before the year is out, while the introduction of a new higher energy cap, which is set to add an additional £139 a year to typical default domestic energy bills, puts further pressure on household finances. The nation’s most vulnerable face an additional salt in the wound as the £20 a week uplift to Universal Credit and Working Tax credits is set to end on 6 October.
“In a recent poll* of interactive investor website visitors, 84% said they have noticed the impact of rising inflation in their day-to-day life, with 55% stating that it is one of the biggest threats to their personal finances.
“The furlough scheme has undoubtedly kept a lid on unemployment, but the burning question is: what happens next?
“The hope is the record job vacancy levels will be able to absorb those who have been rolled off the scheme and have found themselves without a job. However, a mismatch between skills supply and demand is underpinning employers’ inability to fill their vacancies – most notable HGV drivers – and those who have come off furlough won’t necessarily have skills and qualifications in the areas where the demand is.”
- One in four people who have been employees during the pandemic had been on furlough at some point between March 2020 and June 2021.
- Employees with GCSEs as their highest qualification were more likely to have been furloughed than those with degrees or equivalent qualifications.
- 8% of people who have ever been furloughed were no longer employed in the three months to June 2021; this is a similar proportion to employees who had never been furloughed (7%).
- Half of those furloughed were furloughed for more than three months and this group were less likely to be employees by August 2021, when compared with those furloughed for a shorter time.
- The skill set of people who have ever been furloughed was similar to the skill set of current employees who have never been furloughed; however, the former group identified a slightly greater number of skills they would have liked to improve for their career when compared with employees who have never been furloughed.
* The survey was conducted amongst 1,150 interactive investor website visitors between 24 – 27 September 2021.
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