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Government Now Pays Almost 25% of Worker Wages


Almost a quarter of wages for UK jobs are now being paid for by the government as part of the scheme set up to aid those put on leave as a result of the COVID-19 pandemic.

Last week alone saw some 2.5 million people register for the programme. The total number of employees claiming is now 6.3 million - around 23% of the total UK workforce.

Workers will be paid 80% of their wages up to a limit of £2500 a month as part of the job retention scheme.

There have also been 1.8 million new claims being made for Universal Credit according to the Department for Work and Pensions.

The jump in people looking for financial assistance comes as the whole globe prepares itself for the biggest economic catastrophe since the 1930s. The UK economy is expected to shrink by at least 6.5% this year according to forecasts.

Torsten Bell, chief executive of the Resolution Foundation, said: "The 6.3 million jobs being furloughed shows in stark terms the scale of the economic shutdown that Britain is living through”.

"If this kind of volume of workers stay on the scheme for several months the cost will run into the tens of billions of pounds And that is a cost very much worth paying”.

Since April 20, when the scheme first began, around 800,000 employers have announced that they have furloughed their workers.

The government says that £8bn in wages has been paid out thus far. The average payout is £1269, which is roughly half of the limit of £2500. The final cost of the programme could top £30bn as it is expected to run through June.

The government has been urged to extend the scheme by some business groups. However, speaking in an interview for television, Chancellor Rishi Sunak clarified that it was ‘not sustainable’ to extend the scheme at the current level of expenditure.

"I am working as we speak to figure out the most effective way to wind down the scheme and ease people back into work in a measured way," Sunak said.

"But as some scenarios have suggested we are potentially spending as much on the furlough scheme as we do on the [National Health Service] for example. Now clearly that is not a sustainable solution”.

Harry Pererra
Harry Pererra

Harry turns on his experience in journalism and programming to write about the latest news in the world of tech and the environemtn. When he isn’t writing for usave he is working towards his Blue Belt in Brazilian Jiu Jitsu, and prefers dogs to cats.

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