Two-in-five businesses expect to cut jobs in the next six months
Two-in-five finance chiefs at UK businesses expect to cut jobs in the next six months as a result of the coronavirus slowdown.
The survey of 800 senior finance executives at UK companies also found one third had already cut jobs since the start of lockdown and 54 per cent said their organisation had furloughed staff.
Nearly two-thirds of those that had cut job said it was because of a contraction in demand for products or services and 59 per cent said this was to increase efficiencies or productivity by cost reduction.
Twenty eight per cent of respondents said their organisations were hiring, while 27 per cent said their firms had a recruitment freeze.
Finance chiefs broadly praised the measures taken by the government to protect jobs so far, with 76 per cent of respondents saying the government’s policy response had been “very successful” or “fairly successful” in mitigating a rise in unemployment as a result of COVID-19.
Iain Wright, ICAEW director for business and industrial strategy, called for action from chancellor Rishi Sunak in his autumn budget to help protect jobs and retrain workers who have been laid off.
“Our members give government credit for preserving jobs so far, but they believe that a hard landing for the economy is only months away, and that employment will be badly hit. Some of this will be because market demand is weaker, but the crisis is also driving companies to become more efficient. This may improve productivity, but it will cost jobs,” Wright said.
“What we need to see in the chancellor’s autumn budget is a social, education and industrial strategy which combines protection and re-training for displaced workers over the short and medium term, with intervention and investment to create jobs with a future – especially in the green and scientific sectors.”
Yesterday the Office for National Statistics (ONS) said that around 730,000 people have lost their jobs in the UK since lockdown began in March, in the largest quarterly slump in employment since 2009.
Since June, a further 114,000 people became unemployed, the ONS added.