Unemployment has spiked to 4.9 per cent as the impact of coronavirus on the economy start to be felt despite massive government support schemes.
The jobless rate rose in the three months to October, hitting a level 0.7 percentage points higher than the previous quarter.
Meanwhile, redundancies reached a record high of 370,000 in the quarter – although in a glimmer of hope the numbers eased slightly in the final month.
By last month the number of employees on payroll was down 819,000 on the February pre-pandemic figure, despite the fall slowing as the pandemic progressed.
The grim picture emerged even though Rishi Sunak has extended the furlough scheme to cover most of the wages of millions of jobs until March.
It also pre-dates the second blanket lockdown in England, which is thought to have wreaked further devastation on businesses.
The government’s OBR watchdog has predicted that unemployment will surge to 7.5 per cent – around 2.6million – by the middle of next year.
The jobless rate rose in the three months to October, hitting a level 0.7 percentage points higher than the previous quarter
The numbers on payroll fell again between October and November, although the reductions have been less dramatic than the beginning of the crisis. The figure is now around 819,000 below the pre-pandemic level
ONS director of economic statistics Darren Morgan said: ‘Overall we have seen a continuation of recent trends, with a further weakening in the labour market.
‘The latest monthly tax numbers show over 800,000 fewer employees on the payroll in November than in February, with new analysis finding that over a third of this fall came from the hospitality sector.
‘In the three months to October, employment was still falling sharply and unemployment was rising, but the number of people neither working nor looking for work was little changed.
‘Average hours per worker were continuing to recover, though this was before the second lockdown in England.
‘While there was another record rise in redundancies in the latest three months as a whole, they began to ease during October.’
Suren Thiru, head of economics at business group the BCC, said: ‘The latest data confirms that coronavirus continues to weigh heavily on the UK labour market. The re-introduction of tighter restrictions and the expected cliff edge caused by the original furlough scheme end date in October helped drive record redundancies.
‘While the furlough scheme will help safeguard many jobs over the winter months, with businesses facing the prospect of further restrictions and a messy end to the Brexit transition period, major job losses remain probable in the near term.
‘Failure to achieve a UK-EU trade deal risks adding to the longer-term structural unemployment caused by the pandemic by limiting the competitiveness and viability of some industries.’
Employment also fell in the latest figures from the Office for National Statistics
