How the pandemic is rippling through the UK’s job market, in five charts

Safe shopping.
Safe shopping.
Image: Reuters/Henry Nicholls
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The UK government has tried to cushion the economy from a deep recession, with extra assistance for companies and the unemployed. But a look just below the surface shows that the pain from the coronavirus disruption is severe and widespread.

Employment in Britain appears relatively stable, according to Office for National Statics data, published today, for the three-month period ending in April. The turmoil is masked by massive government support: About one in four workers in Britain—almost 9 million people—have been furloughed and are still counted as employed, according to PwC senior economist Jing Teow. The largest annual drop on record for the number of weekly hours worked shows that the labor market has been hit with a massive shock.

“The sharp fall in weekly hours worked, close to 9% compared to last year, offers a truer picture of the impact of rising unemployment and furloughing,” Teow said.

Job vacancies also showed the the biggest drop ever, according to ONS data for the period of March to May. Some of the biggest declines in vacancies have been in retail, automobile repair, hotels, and food service, which have been walloped by lockdowns and distancing measures. Shoppers started returning to more stores in the UK this week as some restrictions were eased after months of government-mandated closures.

“As businesses come out of lockdown from May, labour market prospects could improve. Our research suggests that around a quarter of businesses expect to restart trading in the next month,” Teow said. “The bigger question is how many businesses and workers will eventually return after lockdown.”


People who work for themselves have been swept up in the tumult, with the number of self-employed workers dropping by 131,000 in the February to April period, the most on record. Likewise, the number of paid employees has also plunged, according to ONS data and estimates as of May.


Workers’ total pay, in seasonally adjusted terms, fell for the first time in more than two years. Public sector jobs were a relative bright spot, with average growth of more than 3%. Average pay declined in construction, and regular (non-bonus) pay had weak growth in sectors like manufacturing, retail, hotels, and restaurants.


Despite the government’s furlough program and other measures to keep jobs intact, unemployment claims have skyrocketed. Part of the reason for the increase is that, because the UK enhanced these aid programs to protect the economy from the downturn, more people are now eligible to claim benefits through job seekers allowance and universal credit.

But even though the safety net has been enhanced, some people will fall through the holes. More workers are also likely to seek this support as the furlough scheme is gradually tapered before finally ending in October. In August, a labor survey may provide more information about which racial groups in Britain have been hardest hit.

“Some furloughed workers may not have jobs to return to when this is over, which could put a dampener on the recovery,” Teow said. “Additional stimulus may therefore be required to support a sustained labour market recovery.”