Employment crisis: See how coronavirus maskes 649,000 lose their jobs – Covid-19

There are concerns that the speed of job losses is expected only to intensify as the nation reels from the economic harm of COVID-19.

According to official statistics, almost two-thirds of a million UK employees lose their jobs during the coronavirus pandemic in the midst of fears of an economic crisis that exceeded that of the 1980s.

The Office for National Statistics (ONS) released data showing that, between March and June, 649,000 workers left business payrolls-reflecting the imposed hibernation of the economy to reduce COVID-19 spread.

In June, the figures, taken from HM Revenue and Customs, showed 74,000 fewer people on the PAYE list than in the previous month.

These were released in a week where the Budget Responsibility Office warned the United Kingdom could face an unemployment rate of about 13 percent from its current rate of 3.9 percent as unemployment continues to increase amid continued government support for companies and their wage bill.

The most recent estimates from the Treasury revealed that 9.4 million furloughed employees were already receiving wage assistance from the Employment Retention Scheme. This is scheduled to close in October.

The ONS data showed a slower rate of job losses in June, with unemployed claims under Universal Credit and low-income claims dropping to 2.6 million between May and June by 28.100. Yet the ONS noted in its report the rate of job losses had started to pick up ever since.

Deputy national statistician, Jonathan Athow, said: "As the pandemic took hold, the labour market was dramatically weakened, but the rate of deterioration accelerated into June, although that was prior to recent job loss estimates.

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"According to the new fiscal statistics, there are currently almost two-thirds of a million fewer workers on the payroll than before the lockout.

"The Survey of the Labor Force shows only a slight drop in jobs, but it shows a large number of people with no working hours and no pay."

"There are now many more out-of-work people who are not searching for a job than they were before the pandemic" he said.

As economists had predicted, the wider figures revealed a poor image of pay growth, with annual average weekly earnings falling by 0.3 per cent over the three months to May.

 

He added: "The statistics of today point to the effectiveness of the furlough scheme of the government to protect the labor market from the worsening of the immediate crisis.

"Yet as the Work Retention Program unwinds in the coming months, the recession's full effect on unemployment is likely to show itself."

We all know that we are in the midst of a big job crisis, but why are the news numbers that we prefer to concentrate on not showing a increase in an unemployment?

The answer comes in two parts. The first is that these job statistics often take some time to represent what's going on in the labor market.

This is the case in all countries but the UK employment statistics are particularly "laggy," as economists might term it. And the headline figure of 3.9 percent unemployment reflects the time between March and May, which predates many of the redundancies and job losses that we have learned about since.

The second answer is that millions of Britons were on the furlough system in that time rather than losing their jobs, which meant that they stayed officially employed, even though they were not working.

There's no doubt the UK is facing a slump in jobs-the worst, most likely, since the 1980s. The unfortunate truth is that the numbers are likely to make it clear in the coming year, even if it isn't at present.

The consequence of all this is that we have to rely on secondary data sources for the true picture of what's going on: hours worked, payroll jobs and earnings figures by the ONS all show very sharp declines in recent months, even though the headline unemployment rate isn't.