15.Dec .2020 15:45

UK Unemployment Hits Its Highest Since 2016

UK Unemployment Hits Its Highest Since 2016
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The UK's unemployment rate hit its highest since 2016 in October, before a national lockdown took effect the next month and now, when huge parts of the population face tough new rules on movement beginning Wednesday - Business Insider reports.
The number of people looking for work rose by 241,000 between the months of August and October, taking the jobless rate to 4.9%, data released by the Office of National Statistics showed. That means almost 1.7 million people were unemployed in the same period.

The rate was up from 4.8% in the three months to September, reflecting how things are only getting worse, even without taking into account the full lockdown that was in effect for November and before the latest round of restrictions that come into force this week.

In the third quarter of the year, 243,000 more people were recorded as having been out of work, the largest increase since the 2009 financial crisis. Job losses, or redundancies, rose by 217,000 in the three months to October, and the number of people on payrolls since before the pandemic began fell by nearly 820,000. 
The claimant count, or the number of people seeking jobless benefits from the government, rose slightly to 2.7 million in the same period. The number of people who are inactive but who say that they would like a job in October was 110,000 higher than in February, suggesting that when the pandemic fades, the pool of job-seekers will grow, said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.
Tombs expects the UK's unemployment rate to peak at about 6.5% in the second quarter next year after the country has exited the single EU market.

Finance Minister Rishi Sunak previously rejected calls to extend the furlough scheme beyond its October 31 end-date, even though businesses struggled to cope with the financial stress caused by lockdowns. But after a second wave of the virus hit, Sunak was forced to extend support for firms until March 31.

But the vaccine breakthrough could be a shot in the arm for the labor market and hopefully it will give businesses with furlough still in place the confidence to retain staff, said Tom Pickersgill, CEO and co-founder of Orka Technology Group. "For now however, the statistics paint a stark picture and unemployment is still likely to spike when the scheme finally comes to an end."
Most parts of the UK will be under the toughest set of lockdown rules from Wednesday after a new strain of COVID-19 was linked to a faster rise in cases. London and large parts of the areas around the capital will fall under the government's Tier-3 rules. Restaurants and pubs must shut, except for takeaway and delivery, and indoor entertainment venues like theatres, bowling alleys, and cinemas must remain closed, with no indoor mixing of households and little scope to mix outdoors.
Close to 20,250 cases and 232 deaths were recorded in the UK on Monday, according to government data. Britain has one of the worst death rates in the world, with nearly 65,000 fatalities so far.