UK unemployment edges up in July but much worse expected

LONDON (AP) — Official figures show that unemployment in the U.K. edged up in July even though large sections of the British economy reopened after the coronavirus lockdown.

The 104,000 rise in the number of people unemployed during the three-month period to July raised the unemployment rate by 0.2 percentage points to 4.1% — the biggest increase since the pandemic began.

The increase in unemployment came even after the reopening of the hospitality sector in early July, following on from the reopening of shops selling items deemed as nonessential, such as clothes and books.

Analysts worry that unemployment will start to rise more markedly in the coming months as a salary-support government package, which encouraged over a million companies to keep nearly 10 million employees on payroll rather than fire them, is coming to an end.

Some firms have started laying off staff ahead of the end of the Job Retention Scheme on Oct. 31, and some just never took part in the program. The statistics agency said another 36,000 people fell off the payroll of private companies in August, taking the number to 695,000 since the imposition of the lockdown in March.

Director of economic statistics Darren Morgan said “with the number of employees on the payroll down again in August and both unemployment and redundancies sharply up in July, it is clear that coronavirus is still having a big impact on the world of work.”