Coronavirus: Almost 12 million workers could be furloughed over the next three months

20 April 2020

The hospitality and retail sectors have been hardest hit by the coronavirus lockdown


Up to 11.7 million people could be furloughed over the next three months due to the coronavirus pandemic, according to research from the Resolution Foundation.

Furloughing is the most prevalent within the low-paying hospitality and retail sectors where it affects almost half (46%) of the workforce, the think tank found.

A new government scheme to help to help companies keep staff paid despite them not working due to coronavirus has gone live today.

Employers can apply for direct cash grants through a new online portal on the HM Revenue and Custom (HMRC) website, Chancellor of the Exchequer, Rishi Sunak, announced in a tweet. 

Under the Coronavirus Job Retention Scheme, the government will cover 80% of workers’ wages, up to £2,500 a month, if they have been put on leave.

The system can process up to 450,000 applications an hour, the Treasury says, and up to 5,000 staff will be manning phone lines and webchat services to ensure any questions can be answered.

Employers can expect the money within six working days of making their application.

Chancellor of the Exchequer Rishi Sunak says: “Our unprecedented job retention scheme will protect millions of jobs across the country and is now up and running.

“It’s vital that our economy gets up and running again as soon as it’s safe – and this scheme will allow that to happen.”

Initially, the scheme was supposed to run until the end of May. In an announcement last week, the Chancellor announced that it will be extended until the end of June.

The Resolution Foundation is calling for greater support from the government to help the hardest hit sectors. 

Daniel Tomlinson, economist at the Resolution Foundation says: “The Government’s welcome Job Retention Scheme is what stands between Britain experiencing high unemployment over the coming months, and catastrophic depression-era levels of long-term joblessness.

“It is proving particularly essential in big, low-paying sectors like hospitality and retail, where around half the workforce are no longer working.

“Given the scheme’s central role in both providing a safety net and restarting economic activity, the Government should provide regular updates on take-up and payments, and extend it to allow shorter-hours working.

How does the scheme work?

The Coronavirus Job Retention Scheme allows employers to claim 80% of each of their workers’ wages, up to a maximum of £2,500 per month before tax.

Employees must be furloughed for a minimum of three weeks.

Further information and advice on how to apply to the scheme and whether you are eligible has been published on GOV.UK.  

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