Furlough levels have fallen by a third since January as take-up of the scheme reaches two billion working days

The number of furloughed workers fell by 880,000 in April – and by 1.6 million since January – as the economy began to reopen, while take-up of the Job Retention Scheme reached two billion working days, the Resolution Foundation said in response to the latest HMRC and ONS furlough statistics published today (Thursday).

The latest HMRC data, which gives a detailed breakdown of take-up of the Job Retention Scheme up to 30 April, shows that the cumulative take-up of the scheme has now reached a remarkable two billion working days.

However, the number of employees on furlough has continued to fall over the course of April as the economy started to reopen. The number of employees on furlough fell by 880,000 over the month to reach 3.4 million (or 11.7 per cent of all employees).

This latest fall means that furlough levels have fallen by a third (1.6 million) since the recent peak in January, when 5.1 million employees were on furlough.

The fall in April was driven by employees leaving furlough in retail and hospitality. The number of retail workers furloughed fell by 230,000 to just 600,000 (14 per cent of employees in retail) by the end of April, down by two-thirds since its peak in 2020. In addition, 180,000 hospitality workers left furlough in April. However, 930,000 hospitality employees (48 per cent) were still furloughed at the end of April.

The lifting of restrictions in May is particularly important for sectors like hospitality, and encouragingly up-to-date ONS data published today suggests that the number of people on furlough fell to just over two million by mid-May – the lowest level since October 2020.

The Foundation notes that while the rapid fall in furlough is very encouraging – the fact that over three million employees are still not fully back working at the end of April shows there is still the risk of a rise in unemployment later this year when the scheme ends.

It says young and low-paid workers will face the biggest risk of job losses – with furlough rates among 18-24 year olds 50 per cent higher than among the over 50s (16 vs 10 per cent) – while those still on furlough are heavily concentrated in low-paying sectors of the economy.

The Foundation will examine how low-paid workers have fared during the crisis and recovery in its annual Low Pay Britain report, published on Monday.

Dan Tomlinson, Senior Economist at the Resolution Foundation, said:

“Employees have clocked up two billion days’ worth of furlough since the start of the pandemic. This shows just how big an impact the pandemic has had on the economy – and how vital the furlough scheme has been in term of preventing mass unemployment.

“The continued fall in furlough rates during April as the economy began to reopen is an encouraging indicator that the labour market – as well as the wider economy – is recovering quickly.

“But with around one-in-six young workers still on furlough at the end of April, today’s figures are a stark reminder of the risk of rising unemployment when the furlough scheme ends. The Government must do all it can to ensure those workers find work as quickly as possible.”