Crunch time for 17,000 Northamptonshire workers as furlough, Universal Credit uplift ends

Over-50s most at risk of unemployment, warns think tank

Wednesday, 29th September 2021, 2:56 pm
Updated Wednesday, 29th September 2021, 2:58 pm

Up to 17,000 workers in Northamptonshire face a testing autumn as the government's furlough scheme closes on Thursday (September 30).

Chancellor Rishi Sunak announced the Coronavirus Job Retention Scheme in March 2020 as a tool to protect jobs during lockdown.

Government picked up the tab for up to 80 per cent of wages for businesses forced to close.

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Up to 17,000 workers in Northamptonshire are still furloughed under the Chancellor's job retention scheme

The measures were extended twice but time finally runs out this week with nearly five percent of the county's estimated 362,000 workforce still furloughed.

Most are in manufacturing, retail and service sectors — and many are over 50, which could be an obstacle to finding work despite more vacancies being on offer than at any time in the last 20 years.

This crunch comes at the same time as the temporary £20-a-week uplift in Universal Credit benefit payments is also scrapped for the lowest paid — and household bills are set to rocket thanks to higher fuel prices.

Latest figures showed 9,480 workers still on furlough in West Northamptonshire at the end of July and 7,360 in North Northamptonshire.

Independent think tank Resolution Foundation, which focuses on improving the living standards of those on low-to-middle incomes, says that the majority of furloughed workers should be able to return to their old roles, thousands could need to find new jobs.

Dan Tomlinson, Senior Economist at the Resolution Foundation, said: “Without Furlough unemployment would have risen very sharply.

"This was the worst recession for 300 years and yet the unemployment rate peaked at just 5.2 per cent, the smallest rise in any recession in living memory.

"As sectors such as hospitality have opened up so the number of employees furloughed has fallen steadily. It is now older workers, rather than the young, who are most likely to be on furlough.

"The risk of a rise in unemployment and inactivity when the scheme closes is still real, and this will happen exactly when Universal Credit is cut by £20 a week."

Unemployment in the county fell from 4.7 percent to 4.6 percent in three months to July, but business leaders say there is a shortage of suitable people.

Sean Rose, policy executive at the Northamptonshire & Milton Keynes Chambers of Commerce, said firms in the region are struggling to recruit.

He said: “The unemployment rate was widely forecast to reach much higher levels in the wake of the coronavirus crisis but it has defied those expectations.

“We now have a situation where businesses want to take on people to help them grow again, which will mean the economy can get back to and go beyond pre-pandemic levels – but they can’t get the staff.

“It’s an issue across a range of sectors and it’s vitally important that the government works to find solutions in order to help businesses fill those vacancies.

"That includes everything from training to making it easier to bring in overseas workers to fill roles where there is a chronic shortage of skilled staff."

“It’s positive news that unemployment remains lower than expected and that businesses are keen to rebuild so we have to grasp this opportunity and make sure firms have the people they need to grow.”