Britain is facing an unemployment crisis in the wake of the coronavirus pandemic, with up to 4.5million people left without jobs, Boris Johnson has reportedly warned cabinet members.
The Prime Minister has told cabinet members to brace for a spike in unemployment figures, which could reach the highest number since records began, according to reports in The Sunday Times.
It comes after a poll revealed how a third of companies in the UK are poised to make workers redundant due to the impact of the Covid-19 pandemic.
It also comes as the Chancellor of the Exchequer, Rishi Sunak, this week warned Rishi Sunak warned school closures are a ‘tragedy’ amid claims he has told MPs they are as damaging to the economy as the 2008 credit crunch.
He has privately told colleagues that the impact of keeping millions of pupils at home is the same scale as the financial crisis, which required nearly £140billion in taxpayer bailouts, according to the Telegraph.
Britain is facing an unemployment crisis in the wake of the coronavirus pandemic, with up to 4.5million people left without jobs, Boris Johnson has reportedly warned cabinet members
Boris Johnson has told cabinet members to brace for a spike in unemployment figures, which could reach the highest number since records began, according to reports in The Sunday Times
GDP fell by more than a fifth in the first month of lockdown, and has now contracted by 25 per cent since February. In this chart, 100 on the vertical axis represents the size of the economy in April 2016, showing the extent of the fall compared to previous changes since 1997
His concern comes following reports that the UK economy contracted by more than a fifth in the first full month of lockdown, as shops and factories closed and workers were sent home.
The Office for National Statistics (ONS) said that economic activity was down by 20.4 per cent in April – the largest drop in a single month since records began in 1997, and worse than many experts were forecasting.
Today, a survey by the Chartered Management Institute (CMI), revealed how 34 per cent of managers are set to make staff redundant due to the impact of coronavirus.
As many as 26 per cent are expecting to make the cuts this year, the survey shows.
Tomorrow, the economy is set for a major boost when many high street retailers throw open their doors for the first time since draconian lockdown measures, put in place to stem the spread of coronavirus, were introduced.
But senior government ministers are bracing for a spike in unemployment figures, which are set to be released in two days.
The last month’s figure of 1.3million unemployed could rise to two million, government chiefs fear, while, according to The Times, ministers fear it could rise to 4.5million over the next year.
In a bid to breath life back into the pandemic hit economy, Boris Johnson will tomorrow pave the way for the abolition of the two-metre separation rule by taking personal control of the decision to axe it.
His crucial intervention comes as one of the country’s leading restaurateurs warns that if it is not scrapped, the hospitality sector will be hit by millions of job losses.
In a bid to breath life back into the pandemic hit economy, Boris Johnson will tomorrow pave the way for the abolition of the two-metre separation rule by taking personal control of the decision to axe it
The Mail on Sunday can reveal that the Prime Minister has commissioned a comprehensive No 10 review which will effectively wrest control of Covid-19 social distancing guidance from Government scientists – and, critically, allow the devastating economic impact of the measure to be taken into account for the first time.
One Government source said the move was recognition that ‘there is more to life than the R number’ – the term for the rate at which the infection spreads.
Last night, Tory MPs predicted that the review – to be run by Downing Street’s newly appointed Permanent Secretary, Simon Case – would provide a road map for the two-metre rule to be relaxed in time for the reopening of pubs on July 4.
It comes as Richard Caring, whose empire includes the The Ivy chain, say that expecting people to stay more than two metres apart is ‘killing the country’
It comes as Richard Caring, the businessman whose empire includes the J Sheekey restaurant in London and The Ivy chain, tells this newspaper that expecting people to stay more than two metres apart is ‘killing the country’.
In a rare interview, Mr Caring accuses Mr Johnson of ‘weakness and indecision’, and said Ministers had grossly underestimated the permanent damage being done to Britain’s 26,000 restaurants.
Unless the rule is relaxed, Mr Caring warns, as many as ‘50 or 60 per cent’ of the four-million hospitality workers in Britain could be laid off when the Government’s furlough scheme comes to an end in the autumn.
Mr Caring, a Tory Party donor, adds: ‘This volcano, unless we wake up to it now, it’s going to be horrendous. It’s just going to explode, spewing out unemployed people. The pain and suffering it is going to cause is horrific.
‘There are estimates saying we could have up to five million unemployed. It’s not going to be five million – it’s going to be more. I don’t think we’ve seen anything yet.
‘The Government is actually killing the country right now and the hospitality industry is in the front line of the disaster’.
The insistence of the Government’s Scientific Advisory Group on Emergencies (Sage) on maintaining the two-metre rule has caused an intense political backlash, with Tory MPs and the Treasury joining forces to express concern about the economic damage it is wreaking.
This picture shows a Wetherpoon pub in south London when it was still open. The graphic shows the rules that could be in place in many pubs across the country when they reopen
The graphic shows what rules could be in place in pubs across the country when they reopen
One Government source said the move was recognition that ‘there is more to life than the R number’ – the term for the rate at which the infection spreads. Officials warned that the virus’s reproduction rate has risen to higher than 1 in the South West of England, to 1.1
Figures released last week showed the economy suffered a 20 per cent drop in GDP in April, the largest ever monthly collapse.
Chancellor Rishi Sunak told the party’s backbench 1922 Committee last week that three-quarters of pubs could open if the distance was cut to one metre, and cited the fact that 24 countries had introduced the flexibility to reduce it.
The infection rate in the community has dropped to just 0.06 per cent, while a further 181 people died in the UK in the last 24-hour period to be announced after testing positive for Covid-19.
Researchers found that there is a 1.3 per cent chance of contracting the virus when standing two metres away from an infected person; a figure that only increases to 2.6 per cent when separated by one metre.
The current ‘R’ rate is between 0.7 and 0.9: any number below 1 means that the spread of the virus is decreasing.
Mr Johnson’s new review will take advice from a range of experts, including the Chief Medical Officer Chris Whitty and Chief Scientific Adviser Sir Patrick Vallance – but also behavioural scientists and economists. It will operate in addition to a rolling review of the guidance being carried out by Sage.
It comes as today, hundreds of business leaders, charity bosses and city mayors called those out of work are given support, such as training, in what is being described as an ‘opportunity guarantee’.
Those including the bosses of Heathrow and healthcare giant Bupa signed the letter printed in today’s Sunday Times.