Boss of Britain’s biggest recruiter James Reed warns of job losses ‘tsunami’ on ‘day of reckoning’ when furlough ends
- Government revealed it was paying 6.3m workers’ wages at the start of May
- There were warnings it faced an £8bn bill as a result of the furlough scheme
- The scheme will run out at the end of October, Rishi Sunak has announced
- Here’s how to help people impacted by Covid-19
A ‘tsunami’ of job losses could sweep across Britain when the government’s furlough scheme ends in October, the owner of online job site Reed has warned.
James Reed, chairman of the online recruiter has raised concerns for the futures of some of the six million workers who have been furloughed since Britain went into the coronavirus lockdown at the end of March.
Mr Reed told The Telegraph: ‘Is there a wave of redundancies coming? The danger is a tsunami of job losses.’
Reed chairman James Reed has warned redundancies could sweep across the country when the furlough scheme runs out in October
‘Companies I talk to are a half or a quarter of the size they were when they furloughed people, or they are on the verge of going bankrupt.
‘The worry is what happens when furlough winds up, we could be heading for a day of reckoning’
At the start of May, the Prime Minister’s official spokesman said: ‘Since the launch [on April 20], 800,000 employers have used the job retention scheme to furlough 6.3million jobs. That’s a total value of £8billion.’
The scheme was originally set to cover the wages of staff laid-off temporarily until the end of May, it was later extended until the end of June before Rishi Sunak announced a final extension, lasting until the end of October.
By the start of May more than six million people had been furloughed, with the government predicting an £8bn bill for supporting workers
On the same week the government announced 6.3million had been furloughed, Work and Pensions Secretary Therese Coffey said: ‘Since March 16 to the end of April we have received over 1.8million claims for Universal Credit, over 250,000 claims for Jobseeker’s Allowance and over 20,000 claims for Employment And Support Allowance.
‘Overall, this is six times the volume that we would typically experience and in one week we had a tenfold increase.
‘The rate for UC claims appears to have stabilised at about 20,000 to 25,000 per day, which is double that of a standard week pre-Covid-19.’
The minister said her department had issued almost 700,000 advances to claimants who felt that they could not wait for their routine payment.
According to The Telegraph, the number of jobs listed on Reed is down 57 per cent compared to last year – at its lowest point during lockdown, it was 68 er cent lower than the year-on-year average.