More than 1.6million people were still on furlough when the UK ended lockdown restrictions in July, latest figures show.
HMRC said the total number fell by 400,000 in the month before Freedom Day but admitted hundreds of thousands of people are still relying on the job retentions scheme, with just weeks to go before it is shut down.
Industries such as aviation and travel are amongst those where employees are still unable to return to work due to ongoing restrictions that will continue even when furlough ends on September 30.
Despite this, the Chancellor has rejected calls for an extension of the scheme which, coupled with an upcoming National Insurance tax rise, experts warn will lead to inevitable job cuts.
Are you at risk of redundancy because of furlough? Get in touch: emma.munbodh@mirror.co.uk
Gary Smith, GMB General Secretary, said: “GMB has safeguarded jobs through agreements - but the reality is we face an economic cliff-edge which risks killing the recovery before it even starts.
“With 1.6 million workers still on the furlough, Ministers, unions and employers must come together and agree a successor package to avoid the devastation of mass redundancies.
“There needs to be a package of support for harder hit industries such as aviation, which continues to be directly affected by travel restrictions set by the Government.
He added: “We can’t go back to business as usual. Boris Johnson and Rishi Sunak must act now or be remembered for casting thousands onto the scrapheap.”
Experts have also warned the decision to hike National Insurance will exacerbate job cuts this autumn.
Hacker Young head of tax Andrew Snowdon, said: “Unfortunately, this extra burden may have helped make the decision for employers who were in two minds over keeping the jobs of those on furlough. It will be the employees who suffer as a result."
From October, the government will strip £20 a week from Universal Credit households – a move many families have told The Mirror will force them to foodbanks.
The cut means anyone that does lose their job will get less support from the government.
Charlie McCurdy, economist at the Resolution Foundation, said the government needs to change course.
“The number of people coming off furlough over the summer has slowed to a trickle, as some firms and sectors – notably overseas tourism – struggle to return to pre-pandemic levels of activity.
“As a result, up to a million employees could still be on furlough when the scheme closes at the end of this month," McCurdy added.
“While we expect most of these staff to return to their previous roles, a significant number will not, and we could see a fresh rise in unemployment this autumn.
“Given these circumstances, now is not the right time to cut Universal Credit by £20 a week. The Government must change course.”
Overall, the number of people on the Coronavirus Job Retention Scheme has overall fallen from 9million at the height of the pandemic to under 2million.
A total of 121,600 people between the ages of 18-34 came off the CJRS during the months of June and July.
Despite warnings 1.6million jobs are at risk, the Chancellor of the Exchequer Rishi Sunak insisted his Plan for Jobs scheme is working.
“It’s fantastic to see furlough levels at their lowest since the start of the pandemic with young people in particular getting back to work and kickstarting their careers as the UK gets back to business.
“With furlough naturally unwinding and coming to a close at the end of the month we are doubling down on our Plan for Jobs - focusing our support on giving people the skills and opportunities they need to succeed in the jobs of tomorrow.”
Will the end of furlough lead to more job cuts? Let us know in the comments below
Meanwhile, around 800,000 people have claimed the latest self-employment scheme grant.
Across all five self-employed grants, 9.9million claims have been made and more than £27billion has been claimed by almost three million people, HMRC's data shows.
For furlough claim periods from August 1, the government will continue to pay 60% of wages up to a maximum cap of £1,875 for the hours the employee is on furlough until the scheme ends on September 30.
