Whilst preliminary data estimated that mass redundancy would be a damaging consequence of the coronavirus pandemic, the latest report from the Office of National Statistics (ONS) has discovered that more than 600,000 people were struck from payrolls between the months of March and May of this year.
The redundancies, largely the consequence of the UK’s move to prevent the spread of the COVID-19 virus that has swept across the world this year, stemmed from widespread economic inactivity and the inability for many sectors to trade through the lockdown period.
Universal Credit and Jobseeker’s Allowance claims jumped by a total of 23.3% between April and May to over 2.8million applicants, whilst the claimant count has now increased by a total of 125.9%, or 1.6million, since the start of March – or when the UK officially entered a lockdown period.
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The average wage within the UK fell for the first time in over two years, whilst the previously healthy recruitment market took a steep dive of over 60% in the two months following March - leading to a six million increase in those temporarily out of work and a fall in the average amount of hours worked.
According to the ONS, the total number of hours clocked by UK workers fell by 94.2million, or 8.9%, in the three months leading to April. This, according to the report, is the single largest drop ever recorded.
As a result, many financial analysts are warning that the ramifications for the UK’s economy and jobs market are significant, and that we could well see the biggest jobs crisis in ‘at least a quarter of a century’, the Independent claimed. The UK’s economy contracted by around one-fifth in the first month of lockdown alone.
‘War for talent becoming war for jobs’
Commenting on the news, Matt Weston, Managing Director of Robert Half UK, commented: “We are now starting to see the impact of the COVID-19 lockdown on the jobs market. There are still nearly eight million people on furlough, while early indicators for May suggest that 600,000 fewer employees are on the payroll, with job vacancies falling to a record low.
"The employment landscape is in a pendulum swing. The 'war for talent' is becoming a 'war for jobs'. But despite the rise in the number of candidates in the market, the skill shortage is still raising its head. Professionals with in-demand skills that will help businesses get through this tough market will still maintain strong career prospects and opportunities to consider,” Weston concluded.