One In Five UK Employers Will Cut Jobs As Furlough Scheme Winds Down

Money Tips Daily by Charles Kelly, former IFA and author of

Up to 20% of employers plan on firing staff in response to the furlough policy change on 1 August, which see’s employers pay more, a survey has revealed.

The British Chamber of Commerce is calling for additional training to deal with thousands of redundancies predicted, the BBC said.

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From 1 August, government payments will be cut to a 60% contribution to salaries, with employers paying 20%.

Based on recent figures up to 30 June, 1.9m workers were on furlough, down from a peak of 5.1m in January. The government said 11.6 million jobs have been supported since the Job Retention Scheme launched in April 2020.

The scheme will close at the end of September.

The scheme meant that staff whose jobs were put on hold during the coronavirus pandemic were guaranteed 80% of their salaries up to government limits.

As the scheme started winding down this year, the support has being made less generous to ween businesses of government aid. From 1 July, employers have been asked to contribute 10% towards the wages of furloughed workers for hours their staff do not work, which has now risen to 20% during August and September.

The British Chamber of Commerce surveyed 250 businesses, with 18% saying they were likely to make staff redundant in response to the change to furlough.

A quarter said they would aim to reduce hours or move staff to part-time working patterns.

The tourism industry is in turmoil according to travel experts, which will deprive the UK of billions in revenue.

On a recent visit to two major areas, normal packed with foreign tourists, I saw mainly British visitors. One guide told me that numbers were down substantially with hardly any overseas customers.

Restaurants, hotels and bars are all suffering. Shopping venues like London’s Oxford Street rely heavily on the summer holiday season with half of sales from foreign visitors.

How will this affect the property market? Listen here for my views.

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