21 August
The UK has managed to keep its unemployment rate low with the help of the furlough scheme.
However, the unemployment rate is expected surge once the furlough scheme comes to an end, with many companies already announcing redundancies.
Duncan Weldon, Britain economics correspondent for The Economist, shared an article on the expected increase in unemployment in the UK.
The unemployment rate in June was 3.9%, which is very low compared to the US at 11.1%.
However, the low unemployment rate is attributed to the furlough scheme, which involved the government paying 80% of the wages of the employees.
As the furlough scheme comes to an end in October, companies have to start contributing to the cost of their furloughed employees.
As a result, a number of redundancies have been announced or planned to be announced by various companies. Marks & Spencer, for example, announced its plans to cut 7,000 jobs.
The Bank of England estimates that the unemployment could peak between 7.5% and 12% once the furlough scheme ends.
