It’s widely expected that unemployment rates are to rise fairly sharply, as this scheme has been so widely utilised. The scheme has helped to pay the wages for around 11.6 million workers since the Pandemic started to take effect.
Getting back to work isn’t going to be easy for certain sectors, for example the travel industry, where consumers have been sceptical about spending on holidays due to concerns about having to isolate when they return to the UK. Unless these issues are addressed and businesses manage to stay afloat, it’s likely that many companies will need to make some staff redundant in order to remain afloat.
The big return may also prove to be rather different to that experienced pre-pandemic. It is entirely possible that for example, workers in the travel sector may be required to work for less hours and could even be required to supplement their income. Furthermore, recruitment is likely to be difficult given the on-going uncertainty, and it’s pretty clear that many business owners will have a number of issues that they will need to deal with.
When the furlough scheme was first introduced in March 2020, the Government paid 80% of people’s wages if they worked in an industry where work was considered not possible. This was reduced in August 2020, where 60% was contributed by the Government, and 20% was required by the employer. It’s been a gradual process winding the scheme down, but the end has finally arrived.
However, given a recent upsurge for the economy, certain businesses are now looking to bring in new employees to keep up with new demands. But, certain experts have highlighted how lots of people leaving the furlough scheme and now without a job may not have the skills required to take on these newly established roles. For example, the hospitality industry is starting to get back on its feet, but many positions such as chefs or hotel managers require specialist staff.
It may be that restructuring the business is more effective than simply getting rid of staff. Insolvency practitioners have a variety of processes that can be used to assist directors in being able to continue to trade.
For more information about what the end of the furlough scheme actually means, or to gain impartial advice about a range in insolvency procedures, simply get in contact with RG Insolvency today. We will listen to your case and decide upon the most suitable course of action to suit your specific needs.