The pandemic has created a middle-class unemployment crisis that will get ‘much worse’ as Christmas approaches, experts warn.
Analysis reveals the extent of the jobs bloodbath in commuter towns, resorts and manufacturing hubs.
The number on the dole has already tripled in the hardest-hit towns and cities.
In the ten worst-affected areas there are 138,000 on out-of-work benefits – 75,000 more than before the pandemic.
The analysis by the Centre for Economic and Business Research (CEBR) raises fears that even well-off communities will become job wastelands as they are hammered by the coronavirus recession.
It reveals the hardest hit areas include Slough, Luton and Peterborough as well as affluent seaside resorts such as Brighton.
Economists predict that a million jobs will be lost in the next nine weeks after the furlough scheme ends on Saturday.
Doug McWilliams, CEBR’s deputy chairman, said: ‘The middle class is likely to get hit much worse as we go on. A lot of management jobs have gone, a lot of professional jobs have gone, and some specialist ones. The middle classes have a jobs crisis – their pensions are squeezed and house prices will be lower.’
The pandemic has created a middle-class unemployment crisis that will get ‘much worse’ as Christmas approaches, experts warn
The gloomy figures are drawn from Office for National Statistics data showing the increase in the claimant count in the 12 months to September 10. This combines those claiming Universal Credit who are looking for work and those on the Job-Seekers’ Allowance.
The CEBR has pinpointed the ten hardest-hit cities and towns, which have suffered from the virus’s impact on sectors of the economy such as aviation, manufacturing, hospitality and tourism.
The analysis excludes London, Birmingham, Manchester and Liverpool – which currently have 635,440 claiming out of work benefits, up from 250,985 a year ago – to focus on the economic devastation in towns and regional cities, which typically find it harder to recover from recessions.
Tough new coronavirus restrictions announced last week will hit several regions highlighted by the research.
In Slough, which is heavily reliant on Heathrow, the number looking for work has more than tripled in a year from 2.6 per cent of the working age population to 8.5 per cent, or from 2,510 to 8,100.
In Luton, Easyjet’s headquarters, the number has risen from 4,025 to 11,690. Tougher coronavirus rules announced last week will hit several regions highlighted.
The proportion of claimants in Blackpool in Lancashire has doubled to 11.7 per cent, or 9,940 people, suggesting it is now the number one unemployment hotspot in Britain
Local leaders in Blackpool, now subject to the harshest Tier Three restrictions, say the resort is facing ‘the equivalent of three winters in a row’.
Like Brighton the town has suffered from a sharp fall in visitors.
Other seaside communities facing a sharp rise in unemployment include Hastings in East Sussex, Southend-on-Sea in Essex, and Torbay in Devon.
Northampton is one of several manufacturing hubs to shed thousands of jobs, while the number out of work in Wolverhampton has risen from 9,645 to 17,280 after Jaguar Land Rover and aerospace giant Collins slashed jobs.
Rhe hardest hit areas include Slough (pictured), Luton and Peterborough as well as affluent seaside resorts such as Brighton
The number of people out of work in Wolverhampton has risen from 9,645 to 17,280 after carmaker Jaguar Land Rover and aerospace giant Collins slashed jobs.
In Hull the claimant count has risen from 5.1 per cent to 9.7 per cent – meaning 16,305 people are now claiming out-of-work benefits in the city – and in Peterborough 9,800 people are on the dole, more than double the number before the pandemic.
There are also now more than 26,000 people claiming out of work benefits in manufacturing hubs Middlesbrough and Wolverhampton, meaning the proportion of people on the dole is now more than ten per cent.
Since March tens of thousands of jobs have disappeared in professional consultancy, aviation, events, the arts and travel.
Small independent high street businesses are having to shed staff as shoppers order online. Covid restrictions threaten to kill off bars, pubs and hotels, hitting thousands of small suppliers. Theatres, music venues and galleries have shed staff, while the National Trust has made 1,300 redundant.
Large retailers such as Boots, John Lewis and Topshop owner Arcadia have looked to make saving by axing head office roles.
Ongoing restrictions threaten to kill off bars, pubs and hotels, hitting students, those starting out in the world of work, and thousands of small businesses which supply hospitality firms with food and equipment.
The airline industry is being decimated by the collapse in international travel, putting pilots, flight attendants and airport staff out of work, as well as specialist workers at firms such as Rolls Royce.
The arts have also been decimated with theatres, music venues and galleries shedding staff, while even the National Trust has been forced to make 1,300 redundancies.
Last week Chancellor Rishi Sunak expanded his winter jobs scheme. Before his announcement economists were predicting unemployment, currently 1.5million, or 4.5 per cent, would exceed 2.5million by Christmas.
Before the announcement economists were predicting more than a million job losses in just nine weeks.
This would take unemployment to over 2.5 million by Christmas up from its current level of 1.5 million, or 4.5 per cent.
But the furlough scheme is still supporting millions of jobs, and experts are predicting a ‘cliff edge’ in some industries when it ends on October 31.
Last night there were calls for targeted government support for the worst-affected areas.
Simon Clarke, the Conservative MP for Middlesbrough South, said: ‘We’ve been left behind for 40 years and we’ve had successive lost generations so this is not new.
‘Middlesbrough is a town that has struggled profoundly with the decline of heavy industry and the virus has exacerbated that.
‘We need game-changing investment – we are extremely vulnerable at the best of times, and these are the worst of times.’
Paul Maynard, the Tory MP for Blackpool North, added: ‘Any economy which is seasonal and is now facing the equivalent of three winters in a row will see a significant uptake of universal credit. We need to stabilise the situation, focus on making Blackpool as safe as possible and entice visitors back.’
Peter Kyle, the Labour MP for Hove, said: ‘The Treasury must provide more effective support to prevent towns like Brighton being left behind for a generation.’
Wayne Strutton, the Conservative opposition leader on Slough Borough Council, said: ‘Slough is losing jobs across the board. It has a huge impact, and I fear young people in particular will struggle.’
‘I worried over putting food on the table’
Dave Day was hit by redundancy in July and is now worried he will struggle to pay his mortgage and ‘keep food on the table’.
The 51-year-old had worked at Brighton charity Impact Initiative for more than four years in outreach, caring for families and elderly people with dementia.
Mr Day, who has a 12-year-old son, was furloughed in March and hoped to return to work after the pandemic. But in July he was told his £20,000 a year job was no longer sustainable and he was made redundant.
Dave Day was hit by redundancy in July and is now worried he will struggle to pay his mortgage and ‘keep food on the table’
Mr Day, from Brighton, said: ‘It came as a blow as I really didn’t know how we were going to pay the mortgage and put food on the table. Like everyone else we had to tighten our belts massively. We had to cut out things we loved… and we had to take advantage of school meal vouchers.’
After being contacted by families still desperate for the personal care he offered while at the charity, Mr Day went freelance.
He said people were ‘still desperate for help’ and added that ‘it’s going to take a long time for some charities to recover from this’.
Mother-of-two Hayley Morton has been struggling to make ends meet after being made redundant from her job after 15 years.
Miss Morton, 33, was a customs expert for a company supplying in-flight entertainment, called Panasonic Aviation, which is based at Heathrow airport.
Mother-of-two Hayley Morton has been struggling to make ends meet after being made redundant from her job after 15 years
She was not on furlough during lockdown, and spent much of her time working in the office. She turned down voluntary redundancy, but bosses at her firm axed her job a week later.
Miss Morton, a single parent from Slough, said she is now worried about how she will provide for her two sons, who are seven and ten. She said: ‘It’s hard not to worry, it’s going to take six weeks at least until I receive any support from the Government. In the meantime, I have to afford my rent and food and everything for my boys.’
Thea McCarthy-Curless was left devastated after losing her dream job at a luxury fashion events company.
The 27-year-old had helped put on events for designers including Dior, Vivienne Westwood and Bulgari, but was made redundant at the start of October.
Thea McCarthy-Curless was left devastated after losing her dream job at a luxury fashion events company
She said: ‘Everybody in my industry is suffering so much through the pandemic. I’m trying very hard to be positive but it is tough.
‘It wasn’t like it was just any old job to me, it was my whole career.
‘My industry has been hit worst by this crisis as nobody has any clue when we’ll next be able to put on events at the same scale we had been doing previously.’
Miss McCarthy had been employed by Soho production agency My Beautiful City, which produces events for some of the biggest names in fashion.
Miss McCarthy, from Haggerston, east London, will now focus on freelance work. She said: ‘I’m getting my last pay check next month and I know I will have to savour that.’