The unemployment rate in Britain continues to rise in the wake of the coronavirus outbreak, which has crippled the economic activities across the UK.
According to the latest data by Office for National Statistics (ONS), the UK’s unemployment rate soared to 4.8% in the three months to September, an increase from 4.5%. Terminations grew by a record 181,000 in the period to touch a record high of 314,000.
Companies laid off more employees in a view of the end of the furlough scheme, which was initially expected to finish at the end of October. However, now the furlough scheme has been extended till 31 March.
The data also showed that the number of jobless people increased by 243,000 in the three months, which is the biggest spike since May 2009.
It also revealed that there was a massive decline of 174,000 in the employment of those aged between 16 to 24 years.
Commenting on the job market, Jonathan Athow, deputy national statistician for economic statistics at ONS, told media that a shake-out was now taking place in the UK’s job market.
He said: “We are seeing fewer people on the payrolls and fewer people employed overall. That is now passing through to increasing unemployment altogether.”
He added that more people have been terminated from jobs, which may not be seen as an indication of future job losses, but people could see massive job cuts in big numbers in the coming days.
“We might see furlough creep up again and that might mean we don’t see any further big increases in redundancies or unemployment, but it’s way too early to tell what will happen,” he added”, Athow added.
Tej Parikh, the chief economist at the Institute of Directors, said the coronavirus pandemic is continuing to throw challenges in Britain’s job market.
He said: “In the autumn, employers faced difficult decisions around retaining staff as government support looked set to decline. The initial shape of the Job Support Scheme, originally expected to come into force this month, didn’t provide a smooth off-ramp from furlough.”
“The extension of the furlough scheme through to March is welcome as it has given directors certainty to plan for their staff. Unfortunately, the change appears to have come too late in the day for some”, he added.