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This briefing was last updated on 25 February 2021. This is a fast-moving situation, so please be aware that information may have changed since the date of publication. The Library intends to update this briefing.

This paper tracks the evolving impact of the coronavirus outbreak on the labour market.

On 23 February, the labour market statistics for October-December 2020 were published.

These statistics showed a further increase unemployment, with the unemployment rate at its highest level since early 2016. The annual growth in unemployment at its highest since 2009. However, there were other signs that the pandemic’s impact on the labour market may be beginning to plateau, with continued increases in the level of vacancies and working hours. Redundancies also decreased since their peak in September-November. A big increase in unemployment continues to be forecast for when the Coronavirus Job Retention scheme ends later this year.

To date, the pandemic has had more of an impact on the labour market status of particular age groups.

Since the start of the pandemic in March 2020, employment levels for those aged 16-24 and 65+ have fallen by 299,000, or 6%. In comparison, employment levels for those aged 25-64 have also fallen, but by less at 148,000, or 0.5%.

The number of people claiming unemployment related benefits increased by 1.4 million between March 2020 and January 2021.

11.2 million employee jobs had been furloughed through the Government’s Coronavirus Job Retention Scheme (CJRS) by midnight on the 15 February 2021.

The third tranche of the Government’s Self-Employment Income Support Scheme (SEISS) opened for applicants on the 30 November 2020. By midnight on the 13 December, 1.7 million claims had been made.

Some workers are disproportionally economically impacted by the coronavirus outbreak. Workers who are from an ethnic minority group, women, young workers, low paid workers and disabled workers, have been most negatively economically impacted by the coronavirus outbreak.

For example, 15% of workers in sectors which have shut down because of the coronavirus are from a minority ethnic background, compared to 12% of all workers, 57% are women, compared to a workforce average of 48%, and nearly 50% are under 35 years old. Low paid workers are more likely to work in shut down sectors and less likely to be able to work from home.

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