UK jobs market at crossroads as key support program ends

LONDON (AP) — Hundreds of thousands of jobs hang in the balance as coronavirus cases surge in Britain and the government scales back its support for workers.

Through the pandemic, a generous government salary support scheme kept unemployment in check, but it ends Saturday. It will be replaced by a less generous and more targeted program that seeks to encourage firms struggling with coronavirus restrictions, such as cinemas, pubs and restaurants, to keep workers, even if they only work one day a week.

When launched in March, the Job Retention Scheme was designed to prevent mass unemployment during the lockdown, with the government effectively bankrolling firms to keep staff on payroll even though they couldn't work.

It was one of Europe's most generous furlough schemes and helped prevent what some economists feared could be an almost immediate doubling in unemployment to 3 million, a level not reached since the early 1990s.

At the pandemic's height in May, the government was paying 80% of the wages of nearly 9 million people, or around a third of the workforce, up to 2,500 pounds ($3,250) a month. Though the number decreased during the summer as lockdown restrictions were eased, there are still up to 2 million people relying on wage support.

“Many people working in the sectors hardest hit by the pandemic, such as travel, entertainment and hospitality, have seen their lives and livelihoods completely devastated this year and are questioning what to do next,” said Josh Graff, head of LinkedIn’s U.K. operations, noting that there are 64% more people applying for each job than before the pandemic.

Though Treasury chief Rishi Sunak has responded to concerns by bolstering a replacement program, many people in sectors struggling to survive in a world of social distancing are unsurprisingly anxious.

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