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One in three firms are preparing to lay off staff before furlough ends in October

Almost a third of firms are preparing to lay off staff, according to a devastating report, as Boris Johnson prepares to ditch the working from home guidance and send millions back to the office.

The threat of mass lay-offs in the report comes ahead of figures which are today expected to show the biggest fall in employment since the 1980s as the true economic cost of the coronavirus pandemic emerges. 

There are fears the dire economic situation is being compounded by millions of workers staying at home – in line with official government guidance – meaning newly reopened shops and restaurants are suffering from low footfall.

Boris Johnson will use a press conference on Friday to implore Brits to get back to the office and unveil his roadmap for emerging from lockdown to boost the economy and get cash back on the High Street, as reported by The Sun.

 Currently more than one million firms are claiming taxpayer support through the Job Retention Scheme, which is paying the wages of 9.4million workers. 

The newly released poll of 7,400 firms by the British Chambers of Commerce (BCC) found that almost three in ten expect to decrease their workforce before the furlough scheme ends in October.  A similar proportion (28 per cent) have already laid off staff since the lockdown began. 

Boris Johnson will use a press conference on Friday implore Brits to get back to the office and unveil his roadmap for emerging from lockdown, while balancing the fears of a second wave of the deadly pandemic

The continued economic malaise has spurred the PM to unveil his new ‘Contain Framework’ on Friday that is designed to show workers the virus is under control in their local area.

It is hoped this will tempt people back into the office, alongside the ‘whack-a-mole’ strategy where they will look at extra measures to try and prevent a feared second wave of the deadly disease.

This will include a new grading system when it is safe to travel. The public will still be urged to use public transport between 9am-4pm, rather than at rush hour. And cycle or walk if it is possible to do so. 

A Whitehall source told The Sun: ‘We are looking at the messaging – it will look at grading the times people travel.

‘There is a lot of extra capacity on public transport that is not being used.

‘People will be told that if you avoid the rush hour, the crush times, it is safe to travel.’

Chancellor Rishi Sunak wearing a mask as he purchases his lunch at Pret

Chancellor Rishi Sunak wearing a mask as he purchases his lunch at Pret

The report from the British Chamber of Commerce also said that job prospects are bleaker at firms with ten or more staff, as more than four in ten expect to make redundancies in the next three months. 

UK economy set for ‘incomplete V-shaped’ recovery, says Bank of England expert 

The UK economy is set for an ‘incomplete V-shaped’ recovery from the coronavirus crisis with a bounce back likely to stall at the end of 2020 because of rising unemployment, according to a Bank of England policymaker. 

Bank interest rate-setter Silvana Tenreyro said an anticipated increase in the number of people without work, likely caused by the removal of Government support in the coming months, will slow consumer spending. 

Meanwhile, continued social distancing in key parts of the economy like the hospitality sector and lingering coronavirus fears which may stop some shoppers from returning to the high street could also hinder growth. 

Ms Tenreyro predicted an ‘interrupted’ or ‘incomplete’ V-shaped recovery as an initial rebound in activity loses steam towards the end of the year.

At Prime Minister’s Questions yesterday, Boris Johnson said he cannot wave a ‘magic wand’ to save millions of jobs under threat from coronavirus.

Capital Economics said it expects today’s report by the Office for National Statistics will show around 210,000 people lost their jobs in May, the biggest spike since the recession in the mid-1980s. 

The report – compiled in conjunction with Totaljobs – found recruitment also ground to a halt, with just 25% of firms looking to take on new hires in another grim record for the report.

The figures come amid mounting fears of mass unemployment as businesses shed staff to cope with the fall out from the Covid-19 crisis.

The Governor of the Bank of England Andrew Bailey has already set out a three point plan to bolster the economy, as reported by The Daily Telegraph.

Mr Bailey was understood to be shocked by deserted town and city centres and fears they are holding the economy back.

He has urged the Government to start lifting the remaining lockdown restrictions, get people back on public transport and get people back to work – warning the country will be in a recession for a ‘long time’ if it does not heed his words. 

And he appeared in front of the influential 1922 Committee and said that train usage was 20 per cent lower than usual.

One MP on the conference call with Mr Bailey told the Daily Telegraph: ‘The point he was making is that the only way we are going to revive central London and other city centres is if people feel confident about using public transport. 

Mr Johnson is expected to ask civil servants to lead the way in physically returning to work in order to set an example to the nation.

A majority of civil servants have worked from home during the coronavirus crisis but Whitehall departments are now drawing up Covid risk assessments to determine how many staff can physically return. 

The BCC welcomed Chancellor Rishi Sunak’s announcements in last week’s summer statement – including a Job Retention Bonus scheme, which will give £1,000 to firms for each furloughed employee they bring back to work.

People on The Central Line on London underground on Wednesday morning

People on The Central Line on London underground on Wednesday morning

Hannah Essex, co-executive director at British Chambers of Commerce said the government 'should consider additional support for employers before the autumn Budget to reduce the overall cost of employment and prevent substantial redundancies'

Hannah Essex, co-executive director at British Chambers of Commerce said the government ‘should consider additional support for employers before the autumn Budget to reduce the overall cost of employment and prevent substantial redundancies’

He also unveiled a Kickstart Scheme and an apprenticeship recovery programme to help shore up the jobs market.

Boris Johnson admits jobs WILL be lost after OBR watchdog warned 4MILLION could be on the dole queue by next year 

Boris Johnson insisted he does not have a ‘magic wand’ to save jobs today as he admitted that a wave of redundancies is looming.

The PM said ‘no-one should underestimate the challenges’ the UK faces after the government’s watchdog warned four million people could be on the dole queue by next year.

A dire assessment from the Office for Budget Responsibility yesterday also suggested public debt will rise by around £700billion over the next five years as a result of the coronavirus crisis. 

Pressed by Sir Keir Starmer at PMQs over what he would do to help prop up firms struggling to survive, Mr Johnson stressed the huge support being provided by the state.

But he said: ‘We cannot, I’m afraid, simply with a magic wand ensure that every single job that was being done before the crisis is retained after the crisis.’

Sir Keir also demanded to know what ministers were doing to prepare for a second spike of coronavirus in the Autumn. 

The premier shot back: ‘Not only are we getting on with implementing the preparations for a potential new spike, but he will know that the Government is engaged in record investments in the NHS.’

 

But the BCC and Totaljobs urged him to take more action, calling for a temporary cut in National Insurance contributions to help protect businesses and jobs.

Hannah Essex, co-executive director at BCC, said: ‘Many businesses are suffering from an historic cash crunch and reduced demand, meaning firms will still face tough decisions despite welcome interventions made in the summer statement.

‘The Government should consider additional support for employers before the autumn Budget to reduce the overall cost of employment and prevent substantial redundancies.’

She also said the Government could consider support to ‘upskill and reskill’ employees as businesses adapt to changing working practices after the lockdown.

At least 150,000 jobs have already been cut or put at risk at more than 60 major British employers during lockdown, according to recent analysis by the PA news agency.

Overall, around 75,000 job losses were announced last month alone.

The Office for Budget Responsibility said on Tuesday that Britain could be facing an unemployment rate surging potentially as high as 13% from just under 4% now.

But there are some tentative signs of recovery, according to Totaljobs, which has seen a 30% month-on-month increase in the number of roles being advertised on its website for June.

Sectors benefiting from easing lockdown restrictions saw big rises in vacancies – up 51% across retail, 47% for travel and 23% for hospitality.

A Government spokeswoman said: ‘Throughout the pandemic, we have acted with speed to safeguard jobs and incomes, with our support package totalling £160 billion so far.

‘The Plan for Jobs announced last week, including the Job Retention Bonus and the new Kickstart Scheme, will give businesses the confidence to retain and hire, and to create new jobs in every part of our country.’

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