IPPR - Revealed: One in three people in Scotland’s workforce could be furloughed, or made unemployed over coming months

6 May 2020 06:31 PM

New analysis by Scotland’s progressive think-tank shows that 750,000 people in Scotland could be enrolled onto the ‘Jobs Retention Scheme’ (furloughed) this quarter, and a further 150,000 jobs could be lost as a result of the Covid-19 crisis. This would amount to 900,000 people, or one in three of workers in Scotland.

IPPR Scotland warns that although all sectors have been affected by the economic element of the crisis, some are more seriously exposed to its effect than others:

• Retail, wholesale and motor-trades - Scotland’s largest employment sector outside of health could see 140,000 workers placed on furlough and 30,000 job losses (49 per cent of all jobs in the sector)
• Accommodation and food services - could see 140,000 workers furloughed, and 30,000 job losses (83 per cent of all jobs in the sector)
• Construction - could see 80,000 workers furloughed, and 20,000 job losses (69 per cent of all jobs in the sector)

What’s more, this analysis shows that people working in those sectors with the most job losses were more likely to be struggling financially prior to the crisis:

• 29 per cent of workers in retail, wholesale and motor-trades say they are “just about getting by” or worse financially
• Similarly, 32 per cent of workers in construction and one in three workers in Scotland’s accommodation and food sector said the same   
• As such, the evidence suggests there are large numbers of people in these sectors who would not cope with a reduction in pay or job loss

Researchers at IPPR Scotland warn that, against a backdrop of rising food and energy bills, additional caring responsibilities and the risk of serious illness- this analysis shows that those families who faced financial insecurity prior to this crisis are at the sharp end of the economic consequences today. 

Russell Gunson, Director of IPPR Scotland, said:

“The Covid-19 pandemic continues to be a public health crisis but without question it is an economic crisis too. The pandemic is affecting us all, but some people will undoubtedly be more affected than others by the economic impact of this crisis.

“Our initial analysis shows it’s likely to be those in lower pay sectors and those already struggling with their finances that will be hardest hit by the initial economic fallout. We must do everything we can to support families in Scotland struggling to get by through targeted help for those that need it the most.

“The future is uncertain, but the scale of the challenge to families’ finances from this crisis cannot be understated. Over the coming months we will need the Scottish government to stretch its powers to the limit, alongside significant action from the UK government, to make sure those hardest hit get the help they need to keep themselves and their families afloat.”

CONTACT

Robin Harvey, IPPR Digital and Media Officer,  r.harvey@ippr.org

NOTES

• The analysis What’s the Outlook for Scotland’s Workforce by Henry Parkes, Rachel Statham and Russell Gunson is available here: https://www.ippr.org/blog/outlook-for-scotlands-workforce-furlough-job-losses  
• The analysis looks at OBR projections along with available labour market data in Scotland to estimate sectoral impacts, mapped against financial stress by sector using Understanding Society survey data.
• The work is the first output from IPPR Scotland’s new Rethinking Social Security programme – a two-year programme funded by Standard Life Foundation.
• IPPR Scotland is Scotland’s progressive think tank. We are cross-party, progressive, and neutral on the question of Scotland’s independence. IPPR Scotland is dedicated to supporting and improving public policy in Scotland, working tirelessly to achieve a progressive Scotland. For more information, visit: https://www.ippr.org/scotland