Britain’s unemployment rate rose to 4.1 per cent in the three months to July – 0.3 per cent higher than the year previously, according to latest figures from the Office for National Statistics (ONS).
Over the quarter, young people without a job rose to 156,000, while the number of employees in the UK on payrolls was down around 695,000 compared with March, when the Covid-19 lockdown began.
Although the number of people estimated to be temporarily away from work (including furloughed workers) fell, it was still more than five million in July.
There were also around 250,000 people away from work because of the pandemic and receiving no pay.
However, there was a rise in job vacancies over the period, driven by smaller businesses, according to the ONS, which said some were taking on additional staff to meet coronavirus guidelines.
Matthew Percival, CBI director of people and skills, said: “The easing of lockdown restrictions and a more flexible Job Retention Scheme in July have led to the beginning of a recovery in vacancies and hours worked.
“But rising redundancies, rising unemployment and a record fall in the number of young people in work are clear warning signs of what is to come.
BusinessLive is your home for business news from around the country – and you can stay in touch with all the latest news through our email alerts.
You can sign up to receive daily morning news bulletins from every region we cover and to weekly email bulletins covering key economic sectors from manufacturing to technology and enterprise. And we’ll send out breaking news alerts for any stories we think you can’t miss.
Visit our email preference centre to sign up to all the latest news from BusinessLive.
“Looking ahead, a successor to the Job Retention Scheme is needed to protect jobs and businesses.”
The British Chambers of Commerce’s head of economics, Suren Thiru, added: “While there was a rise in the number of job vacancies, this is more likely to reflect a temporary bounce as the economy gradually opened, rather than a meaningful upturn in demand for labour.
“With many firms are still facing waves of cash flow problems, rising costs and an uncertain economic outlook, it is probable that unemployment will escalate sharply as government support winds down.”