Scots job worries as furlough scheme begins to wind down

THE number of people on furloughed jobs in Scotland fell by more than a third in May, official figures have revealed.

Provisional data from HMRC showed a drop from 275,700 Scots on furlough at the end of April to 173,100 at May 31, a fall of 102,700 or 37 per cent.

Of those still furloughed at the end of May, 83,300 were fully and 89,900 partially furloughe, compared to 153,700 and 122,000 respectively in April.

There was little difference between the sexes, with 86,300 women furloughed in May compared to 86,900 men, meaning take-up rates of 7 and 8% rate respectively.

By 6 June, 120,000 of 207,000 eligible self-employed Scots had claimed £337 million under the scheme available for them, a take-up rate for the fourth grant of 58%. 

The figures emerged as the furlough scheme began to wind down amid fears of a jump in unemployment as firm shed staff to cope with the change, especially as  many Covid restrictions will remain in place until at least July 19 in England and August 9 in Scotland.

A new survey found a third of Scots workers worried about keeping their jobs.

Undwer the furlough chances, staff continue to receive 80% of their salaries capped at £2,500 until the scheme ends in October. 

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But from today employers must pay 10%, rising to 20% in August in September.

During the peak of the pandemic in May 2020, nine million people were furloughed across the UK.

Between February and May this year, the number of people furloughed UK-wide halved to 2.4million. 

Recent Office for National Statistics estimates suggest the numbers continued to fall last month to between 1.3 and 1.9million.

The shift to employer contributions is expected to see firms lay off workers.

The UK Government said the recent decline showed the scheme was working as planned.

The Treasury is concerned that keeping it going while the economy shows signs of recovering could risk a rise in inflation.

Chancellor Rishi Sunak said: “Our Plan for Jobs has supported people’s jobs and livelihoods throughout the pandemic and it’s fantastic to see so many people coming off furlough and into their workplaces with our restaurants, pubs and shops reopened.

“These figures show what we always hoped would happen – that the scheme is naturally winding down as the economy reopens, but continuing to support those businesses and employees that need our help.”

A new poll for Scotland’s national advice service, Advice Direct Scotland, found 35% of Scottish workers were worried about the future of their job.

The Survation study found concerns are particularly high in the north east, with 42% saying they are “quite worried” or “very worried”.

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Andrew Bartlett, chief executive of Advice Direct Scotland, said: “These findings highlight the concerns faced by many Scots about their job.

“It’s particularly alarming to see such high figures among women, the young, and people in the north east.

“The Covid pandemic caused massive economic turmoil, but many jobs have been protected as a result of the furlough scheme or grants.

“With the end of those schemes in sight, it’s likely that many workers will be increasingly worried.

“Anyone who is concerned about their employment rights or their job can contact us at advice.scot for free, impartial and practical advice.”

Karl Handscomb, senior economist at the Resolution Foundation, also warned of a rise in unemployment as businesses adjusted to less financial support.

He said: “Reopening the economy has led to a surge in people returning to work from furlough, particularly young people in sectors like hospitality and leisure.

“But not everyone is back working. Over one in four older workers who were furloughed during the recent lockdown have remained parked on furlough during the reopening, and now face a higher risk of unemployment as the scheme starts to be unwound.”

The Herald Scotland

The Herald Scotland

The Herald is a Scottish broadsheet newspaper founded in 1783. The Herald is the longest running national newspaper in the world and is the eighth oldest daily paper in the world. The title was simplified from The Glasgow Herald in 1992