Prime Minister Boris Johnson has been warned 10 percent of the nation could be unemployed by the end of December, due to the economic fallout of the coronavirus crisis. Consumers are being urged to help out as soon as shops reopen by spending as much as they can to relieve flagging high street branches. A ten percent unemployment figure would mean four million people out of work in the UK.
The UK is to see huge job losses
These levels have only been seen during the Great Depression of the 1930s which some claim was a major cause of World War Two.
A report by the Learning and Work Institute says the “sharpest ever rises are taking unemployment to historic highs”.
House of Lords Economic Affairs Committee chair Lord Forsyth warned: “A great tsunami is going to sweep away the jobs of many people who thought they were in secure employment.”
The report says: “Unemployment could rise above 10 percent in the second half of 2020.
“The unemployment would perhaps reaching levels last seen in 1938.
“This would mean in excess of four million people out of work.
“Even if the recovery is rapid, employment could take five years.”
The late 1930s saw grim conditions of deprivation across the UK.
Some unemployed men took part in the Jarrow March, when 200 men marched from Jarrow, South Tyneside, to London in 1936 to plead with the Government to rebuild industry in the town.
This was because the depression saw the closure of many shipyards in the North East.
It is thought that crunch time for the labour market will come between the start of August, when the government wants employers to start paying a portion of wage subsidies, and the end of October, when the furlough scheme is due to end completely.
At present, many companies are not laying off staff because the Treasury is picking up the tab for 80 percent of monthly pay up to a limit of £2,500.
If severe lockdown restrictions are still in place, Rishi Sunak will have a tough choice: extend the scheme or see the UK suffer a wave of job losses.
The pressure on the chancellor to at least keep furloughing sectors most affected by social distancing, hospitality, leisure, and retailing, will be considerable.