Furlough End Will Impact Older Workers and Slice Wages, Experts Warn

Furlough End Will Impact Older Workers and Slice Wages, Experts Warn



 

The proposed furlough phase out over the next three months is causing trepidation and concern for workers and employers alike. September 30th will see all government furlough support come to an end, preceded by a three month process whereby employers are increasingly responsible for paying their workers’ wages. 

From September 30th onwards, employers will have to decide between taking on their previously furloughed workers full time, or making them redundant. It is becoming increasingly evident that the impact of this decision is going to fall heavier on a certain portion of the working population. 

People aged between 55 and 64 are currently the highest portion of the workforce who are still being furloughed. More than 1 in 4 of workers in this age bracket (26%) have had to remain on furlough for the duration of lockdown. And so in the latter half of this year, where redundancies are not only likely but inevitable, this group of workers will most likely feel the brunt of the impact. 

This situation has come about as the result of certain industries, such as hospitality and leisure, opening up sooner than others. These industries in particular have a large portion of young people working in them, and so most furloughed workers are in the older age brackets, and are now more financially vulnerable. Only 6% of currently furloughed workers are aged between 35-44, and 16% are aged between 18-34. The Resolution Foundation, who are responsible for conducting this study, explains: 

 

‘The rapid fall in furlough rates driven by the reopening of sectors like hospitality and leisure, which disproportionately employ younger workers, the age profile of over 1.5 million employees still on furlough is changing.’

 

Not only are older people likely to be unfairly impacted by changes to furlough, but even those still in work will have their wages cut significantly as redundancies take place. The Institute for Fiscal Studies anticipates that

 

 ‘Tens of thousands of workers will suffer a steep fall in income as employers react by making redundancies. It will mean big income losses for many of those who end up unemployed unless they are swiftly able to find alternative employment’.

 

The only other safety net beyond furlough is the universal credit scheme. But the government is conveniently planning a £20-a-week reduction in universal credit support in September, coinciding with the end of furlough. This double blow might leave even more people in jeopardy, without jobs or safety net. 

Of course, swiftly found alternative employment is not common at the best of times. Changing career at the drop of a hat is not something many people are forced to go through, and it can be a daunting prospect to say the least. But circumstances are looking likely to force perhaps tens of thousands of people in this direction. 



The construction industry, however, has been the lifeline that thousands of people have needed. It is perfectly suited to those people who are looking to make a fresh start, and as working prospects are squeezed once again, embarking on a career as a tradesperson has never been a better option. 

Access Training has seen a large number of people retraining and upskilling in order to continue working and have professional prospects beyond furlough. We have been retraining professionals for decades, since long before Covid, and know how to prepare people for long-term, fulfilling employment in the construction industry.

Among our previous students looking to embark on a new career path, we have had teachers, chefs, taxi drivers, lawyers, entertainers – a great range of backgrounds, professions, and ages. The reason for this appeal is quite simple: tradespeople have been able to continue working throughout the last year, despite lockdowns and all other kinds of obstructions. A great many construction projects have been able to go ahead, meaning that work has been able to continue whilst navigating restrictions. 

Demand for tradespeople has been consistently high, and so are wages. Again, the reasons are simple. Before the pandemic, the construction industry was already experiencing a skills shortage, meaning that work for tradespeople has long been plentiful and well paid. Brexit has meant that a considerable amount of the workforce from the EU have become unavailable, again opening up the opportunities and strong need for more tradespeople from the UK. 

Covid has only continued this high demand for skilled tradespeople, and the construction industry has since become a beacon of hope for those out of work, or whose prospects on furlough are not looking promising. It is not looking to change anytime soon, either, with large-scale building projects scheduled for the next decade all across the UK. It is widely documented that wages and working opportunities are rising. 

In short, now could not be a better time to retrain in the construction industry. If you have a head on your shoulders, are good with your hands and problem solving, then a trade might be the career you’ve been looking for all your life. 

If the warning signs ahead are anything to go by, then furlough is not going to provide a happy ending, and may leave you in a vulnerable position. Use the remaining time ahead to prepare yourself for the worst, and invest in a new professional direction. You’ll never look back.

 

Learn your trade. Get qualified. Make it happen. 

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