649,000 lose jobs in UK's COVID-19 lockdown, Sunak admits difficult time ahead

As many as 649,000 people lost their jobs between March and June during the coronavirus pandemic lockdown in the UK, official data released here on Thursday showed, with Chancellor of the Exchequer Rishi Sunak admitting "difficult time ahead" but stressed that the government had a comprehensive jobs plan in place.

The Office for National Statistics (ONS) recorded 649,000 people leaving company payrolls, a figure which does not reflect a surge in the country's unemployment figures because large numbers of firms have put their employees on the government-backed furlough, or forced leave scheme, put in place by the Indian-origin finance minister.

"We announced last week a plan for jobs worth up to 30 billion pounds... That is a comprehensive plan that protects, supports and creates jobs across the country," said Sunak, during an official visit to a Job Centre in east London on Thursday.

"We are seeing part of that plan in action here at the Barking Job Centre. We are doubling the number of work coaches this year, that's new, incremental activity. But all our other initiatives will also make a difference.

"For example, the Kickstart Scheme to help the youngest in our society most at risk of long-term unemployment. All these are new initiatives, new funding which will make a difference to what will be a difficult time ahead,” he said.

Young people are seen to be the worst hit by the unemployment crisis as many of them are employed in the hospitality industry, which was largely shut down from March 23 when the UK went into lockdown.

"The estimated number of people unemployed aged 16 to 24 years increased by 47,000 on the year, while other age groups remained steady," the ONS said.

It also found that since the start of the pandemic, total weekly hours worked in the UK had fallen by a record 175.3 million, or 16.7 per cent, to 877.1 million hours.

"This was the largest annual decrease since estimates began in 1971, with total hours dropping to its lowest level since May to July 1997," it noted.

UK Business Secretary Alok Sharma said he had "enormous sympathy" for people who found themselves out of work.

"I know it's going to be very, very difficult for lots of people as a result of this. The best thing we can do is continue to open up the economy in a phased manner and a cautious manner and get businesses up and running again," he told the BBC.

Echoing his Cabinet colleague Sunak, he said the cost of inaction would have been "far greater" than the action the government had taken.

The ONS data also showed the pace of job losses slowed in June, with claims under Universal Credit state-funded benefit by the unemployed and those on low incomes falling by 28,100 between May and June to 2.6 million.

The latest UK Treasury figures showed 9.4 million furloughed workers were still getting salary support from the Coronavirus Job Retention Scheme, which is due to end in October. A further 2.7 million self-employed are also getting help.