IoD responds as unemployment remains steady

Responding to the latest official labour market statistics, showing the unemployment rate at 4.9% in the three months to February, Tej Parikh, Chief Economist at the Institute of Directors, said:

“While the labour market continues to battle with the pandemic, there are signs it is turning a corner.

“The Job Retention Scheme is doing a lot of heavy lifting and is helping to keep a lid on jobs losses. Over 2021 the unemployment rate will creep upward as firms tend to weak balance sheets and furlough support ends in September. Nonetheless, the green shoots of a recovery in the jobs market are emerging. 

“As more of the economy reopens over the coming months, businesses will look to take on more staff to meet pent-up demand. While vacancies have slowed recently there is likely to be significant growth in new positions over the spring and summer, barring a return to tighter restrictions.

“The economy is not out of the woods yet, and the government should remain prepared to extend support if the roadmap meets speedbumps. Meanwhile, it is important that retraining and upskilling schemes hit the ground running to help workers find new opportunities in the post-pandemic economy.