New TUC analysis shows employment in hard-hit sectors is struggling to recover from the pandemic
Government should delay hiking up business contributions while Covid restrictions are in place - and extend furlough for as long as necessary
Many employers are using furlough flexibly to support a gradual return to business as usual, says TUC
The TUC has today (Wednesday) warned ministers not to “pull the plug” on the UK’s economic recovery by cutting off support for businesses and workers too soon.
The warning comes as new TUC analysis reveals that employment in hard-hit sectors is struggling to recover from the pandemic.
The analysis shows that just 1 in 8 (110,000) of the 790,000 jobs lost across manufacturing, retail, hospitality and the arts during Covid have been recovered.
By contrast, nearly all the jobs lost in business services and administration – which saw a 220,000 fall in employment – have been recovered.
The union body says ministers must provide ongoing, targeted support for at-risk industries and halt plans to increase furlough contributions for employers while Covid restrictions remain in place.
Today’s analysis also reveals that 6 in 10 workers currently on furlough are working in manufacturing, retail, hospitality and the arts – sectors hit hard by the continuing restrictions.
The TUC fears that if the job retention scheme is ended too abruptly tens of thousands of additional jobs could be lost from these industries.
TUC General Secretary Frances O’Grady said: “Furlough has played a vital role in protecting jobs and keeping businesses running during this pandemic.
“Ministers must not pull the plug on our recovery by cutting off support too soon.
“The government should hold off hiking up employer contributions until all restrictions have been lifted.
“And we need a cast-iron commitment from the chancellor that he will extend furlough for as long as is needed, rather than ending it abruptly in three months’ time.
“Working families need this certainty now – not a rollercoaster approach to protecting livelihoods.”
The TUC highlighted that workers can only be furloughed if their employer decides to use the scheme, meaning that the scheme is well-targeted only to those businesses that need it.
They also note that around two-fifths of furloughed staff (41.6%) are now only furloughed for part of the working week and are working for the rest of it, enabling businesses to use furlough to manage their gradual return to full operations.
- A copy of the analysis can be found here: https://www.tuc.org.uk/sites/default/files/2021-06/Jobs%20and%20recover…
- ‘Hard-hit industries’ correspond to the ONS industry groupings: manufacturing, wholesale and retail; repair of motorcycles, accommodation and food services, and arts, entertainment and recreation. The figures are based on HMRC payroll and Coronavirus job retention scheme statistics.
- From tomorrow (Thursday) employers will have to contribute 10% to furlough as the government contribution will reduce from 80% to 70%. For more information please visit: www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention-scheme/changes-to-the-coronavirus-job-retention-scheme
- The Trades Union Congress (TUC) exists to make the working world a better place for everyone. We bring together the 5.5 million working people who make up our 48 member unions. We support unions to grow and thrive, and we stand up for everyone who works for a living.
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