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Reduced furlough support jeopardises jobs

Around one in five businesses are likely to make redundancies in response to changing furlough rules, according to the British Chambers of Commerce (BCC).

From 1 August 2021, businesses are required to contribute 20% of their furloughed staff's wages, up from 10% in the previous month, with the Government reducing its contribution to 60%.

With the Treasury's own latest median forecast predicting a rise in unemployment by 5.4% between October and December, the New Economic Foundation says that the end of the furlough could result in an additional 250,000 people out of work, however.

The BCC's survey also found that a quarter of businesses may reduce hours or move staff to part-time shifts to deal with the policy change.

The scheme will end completely on 30 September 2021, with the Government recently rejecting furlough extensions which have mainly come from the travel sector.

Between 1.1 and 1.6 million workers remain on furlough, down from the 1.9m who were on the scheme by the end of June and the 2.4m at the end of May.

Talk to us about the furlough scheme.