Amid the ongoing global crisis, unemployment has become a major issue in both developed and developing countries. The long span of lockdown has forced small to medium businesses to pull their shutters down. Even big and booming businesses have been hit hard. Companies have been forced to take the path of either job or salary cut to survive.
The pandemic has affected the global economy as much as or even more than the great recession of 2008. As Boris Johnson’s government is working on restarting the UK economy, many of the British employers face a double edged-sword to axe staff to save money and keep their businesses running.
While the lockdown has been eased in most parts of the country various businesses are trying to shake off the bad time and start anew. Schemes such as Eat Out to Help Out are encouraging people to support local restaurants, cafes, and pubs, though the second wave of coronavirus spike still looms over our head.
According to the reports chancellor Rishi Sunak announced that government support for the scheme is going down and the firms will have to make a compulsory 5% contribution from this month.
With the government’s intention of winding down it scheme by the October, many employees face the sad reality of losing their jobs like the tens of thousands of people who have already faced the heat of this crisis since the COVID-19 pandemic radically changed the way businesses used to work.
Since March, the wage subsidy scheme has kept almost nine million people in work as the government covered as much as 80 percent of staff salaries up to £2,500 each month.
It is important to note that most of the economies around the globe were already suffering even before the pandemic and this just accelerated the process. In the last week it was brought to notice that more than 8,000 high street jobs could be on the chopping block as there coronavirus has taken an extreme toll on the industries.
Food behemoths have faced the biggest challenge in the history of time as people have been locked indoors, and even if they are going out their concern over safety is keeping them from going to restaurants and bars. Reports have it that administrators at burger chain Byron, Currys PC World and WH Smith (SMWH.L) could axe down several employees owing to the extreme slowdown.
Pizza Express is also looking at closing down up to 15 percent, which amounts to 67 restaurants across the country which in turn can put around 1100 employees out of work.
Moving to the hospitality sector, Wetherspoons (JDW.L) revealed its plan to cut 130 head office roles as the situation gets tough with every passing day.
The story of job bloodbath goes on. While Hays travels says it had to fire 878 employees out of approximately 4500 jobs, Dixon’s Carphone (DC.L) slashed 800 store management jobs in an overhaul. DW Sports have been observed putting 1700 jobs at risk as the administration collapsed. Even British Airways (BA) on Friday announced that it will have to cut almost 10000 jobs marking it a “Black Friday.” Additionally, M&Co announced that it would shut 47 stores, which would put around 380 jobs at risk.
Previously, the National Institute of Economic and Social Research (NIESR) announced that ending the furlough scheme in October would be a mistake since it could put 1.2 million people out of their jobs — though the Treasury pledged to pay employers who keep their staff on until January 2021.
According to the Office for Budget Responsibility (OBR) the official unemployment is set to rise to almost 10 percent and remain above the present level of 3.9 percent until 2024.