Cliff-edge fear for Shropshire employers when furlough comes to an end
Hard-hit Shropshire businesses could need support until the end of the year as thousands of workers remain on furlough, it has been warned.
After 12 months of the pandemic more than 30,000 county workers are still on furlough, according to the latest figures.
The number of people being supported by Chancellor Rishi Sunak's job retention scheme has fallen significantly since its peak of 50,000 in May last year, but business leaders have warned that ongoing support could be vital for companies and employees.
Richard Sheehan, chief executive of the Shropshire Chamber of Commerce, said that businesses could be left facing a cliff-edge situation come the end of the scheme.
He said: “Any sudden stop in business support is not a healthy thing, the fact the roadmap is being planned gives businesses a chance to prepare – businesses have and need time to plan. You cannot turn it on and off again like a light switch.
“Ideally we would have support until the end of 2021 because there will be many more bumps in the road.”
Julia Fitzsimmons, partner and head of the employment law team at FBC Manby Bowdler said: “The furlough scheme has undoubtedly protected millions of jobs in the UK and tens of thousands across this region. But behind every job is a person, someone with mortgages and rent to pay and families to feed. The issue will be what happens to these jobs once that support, which is a huge sticking plaster, is ripped away.”
The scheme, has protected a total of 81,100 jobs in the county since it was set up, with 30,300 being supported as of February 28; some 20,200 in the Shropshire Council area and 10,100 in the Telford & Wrekin Council area. Powys has 7,300 still furloughed, with 18,700 workers having been helped since the government opened the scheme.
Hospitality remains the most affected, with 6,710 workers being supported across the county, although the wholesale retail and garage sectors are not far behind with 6,600 workers on the scheme.
The government support, which has been extended to the end of September, has proved a lifeline for many workers.
Businesses have also spoken of the importance of the support, with James Hitchin, owner of the Alb pub and cocktail bar, and Bombos in Shrewsbury, saying it had protected staff – and put the businesses in a position to start up again when lockdown is lifted.
He said: “Instead of saying to some staff ‘you have a job, you don’t have a job’, we were able to keep staff employed without losing our full team.
“It is alright to be ruthless in business but what I have got, because I run cocktail bars and the kitchens are more specialist – with sushi chefs who take years to train – it would have cost a lot of money to retrain staff.
“I have staff who have worked for me for three, four, five years and I spent a lot of time finding those staff and I do not want to lose them just because they need to maximise their hours to make a living.”
North Shropshire MP, Owen Paterson, said it had been vital, but the focus has to be on getting the economy going when restrictions are eased.
He said: “It has been massively important to many people who otherwise would be made unemployed, but the answer is to get the economy moving again and make it rapidly unnecessary.”
