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‘Massive increase’ in unemployment predicted when furlough ends, meeting hears

PUBLISHED: 12:00 09 October 2020

Clockwise from left to right: Cllr Jane Jones, Cllr Sade Bright and Barking and Dagenham's head of enterprise and employment strategy Rachel Laurence. Picture: LBBD

Clockwise from left to right: Cllr Jane Jones, Cllr Sade Bright and Barking and Dagenham's head of enterprise and employment strategy Rachel Laurence. Picture: LBBD

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A “massive increase” in the number of unemployed people may result when furlough ends this month.

Barking and Dagenham Council’s head of enterprise and employment strategy, Rachel Laurence, issued the warning at an online meeting of the town hall’s watchdog overview and scrutiny committee on Wednesday, October 7.

A total of 49 per cent of people in the borough who are in work receive furlough or self-employment support and are at risk of being made redundant when the government support ends on October 31.

Ms Laurence said: “We need to be prepared that when the furlough scheme ends they may become redundant.

“What we’re facing here is already a potential for a further massive increase in the amount of people who are unemployed in the borough.”

A total of 30,800 people are on furlough with another 17,600 receiving self-employment support, figures from the Office for National Statistics and HMRC show.

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In August, 29,165 people were claiming universal credit. The number was 14,544 in March.

Of those claiming the benefit, but not in work, the figure rose from 9,060 in March to 17,946 in July.

Ms Laurence said: “We can assume a large quantity of those furloughed people are in the retail trade and we can assume a lot of those businesses are really struggling. A high proportion of furloughed people are likely to be in sectors that are already fragile.”

The borough is preparing for the unemployment figure to rise from 10 to 15pc if a large proportion of those people lose their jobs when furlough ends, the meeting heard.

The committee members heard that while “lots of exciting” projects were happening, such as Dagenham’s film studios and the relocation of three markets, these would take a number of years to come to fruition.

A campaign, green jobs push, six month paid placements for young people and a project helping long term unemployed are among support plans.

Cllr Jane Jones, who chairs the committee, said: “The figures are really quite frightening and dire. There’s going to be an awful lot of hard work trying to keep everybody employed until the film studios, all this building work and markets get going.”


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