KPMG comments on today’s labour market figures

KPMG comments on today’s labour market figures

“Furlough effective in keeping unemployment rate down so far” says Yael Selfin, Chief Economist at KPMG UK.


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“Minimal change in April’s headline unemployment rate is good news for UK workers, who have been benefitting from government support schemes. Despite more than a 20% fall in weekly hours worked in April, the unemployment rate remains at pre-COVID levels.

“However, the true impact of the crisis on the labour market is likely to only be revealed once the JRS starts unwinding in the second half of the year. Many businesses are expected to bring only part of their furloughed workers back, while they seek to tentatively reopen after the lockdown. Hiring new workers is also likely to be put on hold for some time.

“This means we could see the rate of unemployment average 11% next year - and the last time it reached these levels was during the recession in the 1980’s. During that slowdown, the rate of unemployment fell by 1.4 percentage points between 1987 and 89, much faster than in the aftermath of the financial crisis. However, even at that rate, the unemployment rate would not return to 5% for over four years this time.”



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Notes to Editors:

About KPMG

KPMG LLP, a UK limited liability partnership, operates from 21 offices across the UK with approximately 17,600 partners and staff.  The UK firm recorded a revenue of £2.40 billion in the year ended 30 September 2019. KPMG is a global network of professional firms providing Audit, Tax, Legal and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity.  Each KPMG firm is a legally distinct and separate entity and describes itself as such.

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