With Johnson announcing the economy will be open by the end of June my expectation is that Sunak will be rapidly unwinding furlough and other economic support schemes in the Budget next week.
This could be bad news. This is from today's news on employment:
Employment is down. Unemployment is up. Economic inactivity is up. And one in eight people is still on furlough.
Of course some of those people will go back to work. But the risk of corporate failure on reopening is very high. Many businesses simply have too little capital to reopen with ease.
The ONS says that these figures should be used with care. I agree. They are wrong, like so much the ONS now produces, being politically overladen with the government's narrative.
But my real message is that this is not the time to withdraw all help. Real people and tens of thousands of people will suffer real, hardship if that's what Sunak does. Which does not, in the slightest change my expectation that he will withdraw support.
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Currently there are 1.74 million officially unemployed(5.1%), the BoE reckons that figure will peak at 7.75% by the summer without extension of the furlough scheme. By my reckoning that’s another 900 000 unemployed, taking the total to around 2.66 million .With 6 million currently on furlough that assumes that 5 out of 6 will remain employed when things open up. That does seem very optimistic.
I know these figures are suspect as to accuracy. However this will actually effect hundreds of thousands(if not over a million when considering the 700 thousand who have already lost
work) not tens of thousand’s.
https://www.bbc.co.uk/news/business-52660591
Agreed
I’m hearing anecdotally it’s really hard to find work at the moment. Even shelf stacking jobs put you on a long waiting list.
So not only is unemployment high and soon to become much higher but it’s potentially very hard to solve, even for people who would normally have no trouble finding work.
When I see figures such as 500,000 EU citizens leaving the UK for good, and 795,000 foreign born workers having left in the past year, should I see this as a shrinking UK workforce carrying a bigger burden, or unemployment reduced/exported?