Unemployment

No city or large town has been left unaffected by the impacts of Covid-19, which has sent shockwaves through the UK labour market and in some cases heightened existing inequalities to do with unemployment and skills.

How has Covid-19 affected unemployment?

Between March 2020 and Jan 2021, 1.3 million people lost their jobs as a result of Coronavirus. Although some parts of the country are now beginning to stabilise, significant challenges remain. What is clear is that places up and down the country are reacting differently to the reopening of the economy and the lifting of restrictions. With the end of the furlough scheme looming, the next steps for the Government will be to implement policies that get those who have lost their jobs back into the labour market and support industries that have been hit the hardest.

The impact of Covid-19 on UK workers

As of June 2021, 1.9 million people in the UK remain reliant on the Coronavirus Job Retention Scheme. The latest HMRC data shows a continuation of the previous downward trend, brining the number of those claiming furlough to its lowest level since the scheme began. This compares to 4.5 million workers on furlough back in March 2021, which marked exactly one year since we were told by the Prime Minister to stay and work at home.

Which places are most reliant on the furlough scheme?

The number of people on furlough has fallen in every city and large town, however several places remain heavily reliant on the scheme. Furlough take up rates are still high places like Crawley and Slough due to their reliance on the travel and aviation sectors, a pattern which has stayed consistent throughout the pandemic. Take up rates also remain high in big cities like London, Glasgow and Birmingham, likely due to a large proportion of office workers working from home which limits consumer spending and economic activity in city centres.

Economic activity appears to be picking up in tourist hotspots

Previous analysis of the HMRC statistics showed that coastal places like Blackpool and Bournemouth were among the top places reliant on the furlough scheme. The latest data shows these cities no longer feature in the top ten, suggesting a bounce back in economic activity which is feeding through into the job market.

Which cities are leading the job recovery?

Our recent research reveals that as we begin to recover from the pandemic, job growth is unevenly spread across the country, with postings in cities and towns in the North and Midlands outperforming those in the South and South East. Barnsley, Mansfield and Stoke have recorded some of the strongest job posting recovery to date, whilst Aberdeen, Belfast and Crawley have experienced the weakest, with London also lagging behind.

What’s next for the world of work as we recover from Covid-19?

Job creation is the most pressing policy challenge we now face. According to our latest research in partnership with HSBC UK, almost 10 million new jobs will need to be generated to recover from the pandemic. This research looked at patterns of the past, specifically the UK’s jobs miracle between 2013 and 2019, to highlight how cities will play a particularly important role in the UK’s recovery, representing the main job creators post-Covid.

How can the Government support the post-Covid UK labour market?

  • Encourage a new wave of job creation to offset the 1.3 million posts lost as a result of Covid-19, driving productivity growth in the recovery phase.
  • Implement policies to protect workers in sectors that are unlikely to recovery quickly in the months ahead as the furlough scheme comes to a close.
  • Focus on retraining those who have lost their job in the pandemic, investing in skills to make it easier for people to move between jobs and industries.
  • Support high street businesses and hospitality, sectors which have seen strong job growth in recent years, through a ‘Spend out to help out’ voucher.
  • Support labour intensive industries such as construction – a sector which has played an important role in creating jobs across the country – and has a part to play in the Government’s green agenda.

Pre-existing inequalities affecting employment

Centre for Cities’ Cities Outlook 2021 highlighted the stark inequalities that exist in terms of access to job opportunities and education across the UK. Much of this inequality comes down to differences in industrial structure within cities, as shown by City Monitor. For example, London is home to almost 25 per cent of knowledge intensive private-sector jobs, compared to just over 5 per cent in Burnley. If the Government is to successfully address this inequality, its levelling up agenda should focus on investing in skills and improving office working space and city-region transport infrastructure to attract more high-knowledge businesses to underperforming places.

How is Covid-19 affecting jobs?

While unemployment is on the rise everywhere, some parts of the country have been hit hard by Covid—19 more than others.

How is unemployment affecting people?

Covid-19 is reshaping the economy, changing demand as well as ways of working.

Building back better: How to recover from Covid-19

Kathrin Enenkel and Tom Sells

This report examines the pattern of private sector growth within the UK’s seven-year jobs miracle to inform how new jobs can be created as the Government looks to ‘build back better’ and level up the country.

Report 22 Mar 2021

Skills and the future of work

Technological changes, globalisation and other labour market trends, compounded with Covid—19, are reshaping the world of work, with implications for policy.

Cities Outlook 2018

How will the rise of the robots affect jobs in UK cities?

Read it in full here

Opportunity knocks? Economic outcomes for low-skilled people in cities

Cities can offer low-skilled people good economic outcomes that support inclusive growth aims, but inclusive growth cannot come without economic growth.

Read the full report here

Showing 1–10 of 104 results.