UK manufacturers planning tens of thousands of redundancies



Almost half of firms surveyed by lobby group are considering cutting jobs






Orders in the manufacturing sector have declined sharply in recent weeks.






Orders in the manufacturing sector have declined sharply in recent weeks.
Photograph: Alamy

Britain’s manufacturers are poised to make tens of thousands of workers redundant after a worse-than-expected slump in orders, prompted by the pandemic that has left many firms struggling to survive.

A survey by the manufacturers’ lobby group, Make UK, found that 25% of companies are already drawing up plans to cut jobs in the next six months. A further 45% say they are considering redundancies.

Only 30% said they expect to emerge from the coronavirus pandemic with all their staff on the payroll.


The worst-hit firms, which account for more than a quarter of those planning to make redundancies, expect to cut more than half their workforce while another 30% said they would need to lose a quarter of their staff over the next six months.

Orders for cars, heavy machinery and manufactured equipment has declined sharply in recent weeks despite an easing of the lockdown to combat the Covid-19 outbreak in parts of Europe and the US.

The Make UK chief executive, Stephen Phipson, said: “There is no disguising the fact these figures make for awful reading with the impact on jobs and livelihoods across the UK.”

Michael Saunders, a member of the Bank of England’s interest rate setting committee, warned that the outlook for British businesses looked bleaker than it did earlier this month when the central bank said growth could be restored by the end of next year.

He said the “searing experience” of the coronavirus crisis would leave its mark long after the lockdown was lifted and the central bank should risk pumping too much stimulus into economy rather than too little to combat a severe downturn.

Saunders, who was one of only two members of the nine-strong MPC this month to back an increase in the stimulus programme, said he expected an acceleration in the already high rate of unemployment and an increase in the number of companies going bust would leave long-term scars on badly affected industries.

The Office for National Statistics said the hospitality, retail and leisure industries had already suffered a steep decline in job vacancies, with low-income workers the worst affected.

The number of vacancies on offer had more than halved since severe restrictions were imposed in March, with even bigger drops in the retail and hospitality sectors.

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Official monthly figures for vacancies are only available up until April but the ONS said that by using data from the online job search engine Adzuna it was able to add the current state of employment opportunities to its list of Covid-19 tracking indicators.

Adzuna said its breakdown of the vacancy data showed job vacancies in hospitality and catering had decreased by 86% since the start of the crisis, with retail down by 70%.

While the gradual reopening of construction sites and non-essential shops had led to some industries stabilising, Adzuna said recovery was likely to be slow as employers re-entered the market cautiously. Job losses in key sectors such as hospitality had disproportionately affected lower-income workers, with 64% of job losses coming from those earning between £15,000 and £24,299.

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