More than 6.5 million jobs will be taken out of the UK economy due to coronavirus, with the average family £515 a month worse off, according to a new study.
The figure equates to around a quarter of the nation’s total jobs while wage cuts have slashed nearly a fifth off the typical household’s income.
Accommodation and food services are predicted to suffer the worst, with 75.1% of jobs lost, around 1.3 million positions.
Second on the list is “other services” at 50.2%, ahead of “wholesale, retail and repair of motor vehicles” at 47.6% - or roughly two million jobs.
Next came transport and storage on 44%, or some 700,000 positions, before a gap to “administrative and support services”, at 26.5%.
The study, by the Institute for Social and Economic Research at Essex University, says other sectors, including agriculture, forestry and fishing, could lose one job in 10 due to reduced demand from the accommodation and food sector.
Certain sectors showed an increase, such as health and social work, with a 27.1% rise, and “professional, scientific and technical activities”, up 3.4%.
The modelling reflects the capacity of some people to work from home, which leaves some sectors less affected than others.
Professor Matteo Richiardi, who led the research, warned the risk of jobs being permanently lost depends on the length of the lockdown.
He said: “If this is short, say a few months, the links between employers and employees of affected industries might not be severed, and individual careers might not suffer too much.
“Under a longer lockdown, losses of human capital and scarring effects will occur. The economy will still bounce back, but at a higher cost for individuals.”
Meanwhile, the Centre for Economics and Business Research (CEBR) claims an average family is £515 a month worse off because of coronavirus.
A report by the body says wage cuts have slashed nearly a fifth off the typical household’s income, while millions of self-employed face an agonising wait for Government cash.
The combined impact will wipe almost £43billion off household disposable incomes between April and June, the CEBR warns.
Given the scale of the blow to people’s finances, it predicts the Government will be forced to cut certain key taxes - for now at least - to help ease the pain.
“A temporary reduction in VAT, or stamp duty exemptions are policies that the Government should be considering implementing at the end of the lockdown, to restart spending at the end of the crisis,” it says.
The Resolution Foundation thinks as many as 11.7 million people could be furloughed or unemployed over the next three months.
The report entitled Launching An Economic Lifeboat: The Impact Of The Job Retention Scheme warned of the possible extent of joblessness, but pointed to the mitigation impact of the scheme.
It said: “Although we estimate that non-working could increase by as much as 11.7 million in Q2 2020, this is heavily tilted towards use of the JRS (8.3 million employees).
“Unemployment could still rise sharply to 3.4 million (10%) in Q2 2020, but because of the JRS it will not reach catastrophic levels.”
