Almost half of businesses to cut jobs or stop hiring, CBI predicts
ALMOST half of businesses plan on cutting jobs or freeze hiring altogether over the next year because of the coronavirus crisis.
An annual survey by the Confederation of British Industry (CBI) also shows how companies are gearing up to cut hours and restructure their workforce.
Around 46% of businesses said they plan on axing full-time jobs or stop hiring altogether, while 48% are looking to overhaul their company "as a priority".
But 51% of firms told the CBI they expect to keep or increase the number of permanent roles.
In addition, one in ten companies intend to use the Kickstart scheme to create jobs for young people.
The findings come ahead of the government closing its furlough scheme in October, with the CBI calling for "another lifeline" to keep people in work.
What to do if you're facing redundancy
LOSING your job can be incredibly stressful, we explain what you should keep in mind.
- Know your rights: If you’re faced with redundancy, your employer must treat you fairly and act in accordance with your redundancy rights. That includes making sure you’re consulted, and giving you a notice period.
- Redundancy pay: You are also entitled to redundancy pay if you have been with the company for two years or more. The amount you are compensated will vary depending on your age, and how long you have been with the company.
- Review your finances: If you do receive a redundancy payment, don’t get tempted to spend it straight away. It might take time to find a new job, so it's worth making a budget for yourself.
- Search for work: Once you've sorted your finances, you can then start to look for a new job. You may need to update your CV - we round up eight tips from recruitment expertsand other little-known schemes to help you find a job.
Rishi Sunak has ruled out extending the Coronavirus Job Retention Scheme - but the Chancellor has hinted that a new package of support could be on the cards.
Mr Sunak hasn't revealed details of what could be in store, but in an update to the Cabinet, he said the Treasury is looking at "creative" ways to tackle job losses.
Some 9.6million people have been furloughed by their employer since the start of the coronavirus crisis.
The warning from the CBI comes as UK unemployment rose to 4.1% in the three months to July with 695,000 workers losing their jobs since March, according to latest Office for National Statistics (ONS) figures.
The Institute for Employment Studies also this week predicted that half a million jobs will be lost this autumn as unemployment reaches its highest level since the mid-90s.
The Office for Budget Responsibility (OBR) recently also said that unemployment could hit 12% this year as the furlough scheme winds down.
This would affect 3million people, up from 1.3million in 2019.
The CBI spoke to 248 businesses for its latest survey.
Matthew Fell, CBI chief UK policy director, called on the government to open a new "short-time working scheme" for businesses who have a sustainable future after Covid-19.
He said: "The UK labour market has been under heavy stress since the outset of the Covid-19 crisis.
"Although the economy has started to re-open, pressure on firms remains acute. As the Job Retention Scheme unwinds, it’s crucial another lifeline is found."
Carmen Watson, chairperson of recruitment agency Pertemps, said: "Results of the survey are generally consistent with recruitment market trends up and down the country.
"It is not uncommon for permanent recruitment to drop significantly during periods of recession and, usually after a short recess, the temporary side of recruitment kicks back in."
A spokesperson for the Treasury told The Sun: "Our £160 billion package of support, including the furlough scheme, has saved jobs and continues to protect the livelihoods of people across the country.
“Many of our unprecedented interventions - including the Job Retention Bonus, business rates holidays, VAT cuts and the Kickstart Scheme - will ensure this support continues into next year.
“We’ve not hesitated to act in creative and effective ways to support jobs and we will continue to do so as we recover from this crisis."
Most read in Business
Fresh calls have been made for the scheme to be extended over fears the UK could be hit with a “second wave” of redundancies.
READ MORE SUN STORIES
Furloughed workers should find out this week if they’ll face redundancy when scheme ends in October.
London City airport, Pret A Manger and Marks and Spencer are among those to have announced redundancy plans.