Covid-19 second wave jobs fear with unemployment rate set to rocket

It is feared almost one in seven people in the UK could be jobless by the end of this year if a second wave of the coronavirus pandemic strikes.

The Organisation for Economic Co-operation and Development (OECD) said the UK’s unemployment rate could rocket to 14.8 per cent with global job losses at levels comparable to the 1930s.

Even without a second wave of infections, the UK unemployment rate is likely to reach a record high of up to 11.7 per cent by the end of this year, the OECD reported.

Next year it would drop to 7.2 per cent if there is no second wave, but this is still a massive hike from the end of 2019, when the unemployment rate was 3.8 per cent.

“The war has to be won and it has to be won fast,” said OECD secretary-general Angel Gurria, adding that the economic disaster has been magnified by the inability to fight the virus.

“We don’t have vaccine and we don’t have a medicine, we’re impotent … we’re closing down the cities like they used to do in medieval times, because it’s the only thing we know that works.”

The warning came amid dire economic forecasts from his colleagues.

OECD director of employment, labour and social affairs Stefano Scarpetta said: “Only in a matter of three to four months, in terms of unemployment, we have gone back to where we peaked after the 2008 financial crisis.

“I think we are talking about an impact on the labour market, which is unfortunately closer to the Great Depression more than the financial crisis – the impact is massive.”

Last month the OECD warned expects UK GDP to drop 11.5 per cent in 2020, and up to 14 per cent if there is a second wave later in the year.

Mr Gurria said: “These numbers do not convey the massive hardship that is implied by an increase in unemployment of this scale.

"They mean large jumps in poverty, personal bankruptcies, depression, homelessness, crime. That’s why policy responses must be timely, they must be ambitious, and they must be sustained.”