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Workers not seeking jobs as furlough winds down

With most of us hoping that the worst of the pandemic may be over, despite still worryingly high case numbers, the predictions about a huge rise in unemployment following the phasing out of the Coronavirus Job Retention Scheme, or furlough, seem to be wide of the mark.

Figures from the Office for National Statistics show the opposite to be true, with its latest statistics showing job vacancies up and the jobless rate having fallen from 4.9 per cent to 4.7 per cent.

The ONS statistics also show that working hours are still to return to pre-Covid levels, but the redundancy rate dropped to 3.6 per cent for the quarter.

A recent survey has found that only 11 per cent of staff still on the scheme which ends at the end of September, were actively looking for jobs, a potential headache for employers who may feel they have to make cutbacks.

Many workers still furloughed will be eyeing the end date anxiously, while employers and their HR departments wrestle with the possibility of laying staff off or making them redundant when the scheme ends.

But with the labour market seemingly buoyant and vacancies back to and even above pre-Covid figures, there could be silver lining for those potentially affected.

There are many unfilled vacancies, particularly in the hospitality and logistics sector.

The survey found reasons for job search inactivity included many having sufficient savings, fears over returning to the workplace with Covid still a threat with others citing child care and access to benefits for the lack of urgency.

The survey also found that 41 per cent of those still on furlough are not searching for other work, along with over 56 per cent of those not currently working.

Jack Kennedy, UK economist at Indeed, warned about being complacent about finances and said employees on furlough appear to be taking a relaxed approach.

He said on his Twitter feed: “Among the unemployed, a sense of financial security is allowing some to be choosier about the jobs they search and apply for. Around 30 per cent of unemployed people who are not urgently looking for work said they had a financial cushion sufficient for some time.

“Despite current record vacancies, one-third of respondents want to wait for more job opportunities. Suggests degree of mismatch — available jobs may not be in fields people want. However, some respondents may simply be waiting for better opportunities to emerge. “

It’s clear that HR departments will be busy, whether with the hiring of new staff or letting go of others, as the full impact of Covid unravels.

For help and advice on matters relating to employment law, contact our expert team today.

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