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Birmingham Post
Birmingham Post
Business
Tom Houghton

Liverpool in 'worrying position' as imminent jobs crisis looms, John Moores University academics say

Academics have said Liverpool is in a "worrying position" ahead of the looming Covid jobs crisis, with unemployment set to "accelerate hard" in the city.

Dr Patricia Harrison and Dr Helen Collins of Liverpool John Moores University say the city region's position comes from a reliance on retail, hospitality and manufacturing.

The employment and labour market researchers have laid out their predictions on who will be hardest hit once the furlough scheme "safety net" comes to an end.

And that spells concerning news for the Liverpool City Region, which already had the highest number of jobless people in the UK in March and April.

The gloomy predictions come as employers in Liverpool and across the UK continue to make large-scale redundancies. The past few weeks alone have seen a long list of redundancy announcements including at Britannia's Adelphi Hotel, Jaguar Land Rover and Superbowl.

The Liverpool Business School researchers said with "almost daily headlines of companies going to the wall", the city's reliance on retail, hospitality, manufacturing and distribution is bad news for the city in the short to medium term.

Dr Harrison said: "There’s more bad news too for while the Chancellor’s furlough scheme has served as a stop-gap for household incomes, as that safety net is removed, job losses are certain to accelerate, hard.

"The 27% of employment-active people in the city who have relied on government schemes to support their incomes during the pandemic could see their earnings go from 80% to zero as employers take a long hard look at their salary bills."

She said younger workers would be first in the firing line.

That's because more than a third of 18-24 year olds have lost their job or been furloughed - and that does not include students.

She said: "Even where you might expect investment, such as the NHS and care, it seems that despite much talk of re-evaluating the contribution of health professionals, we may not see new rounds of recruitment, particularly after recent Government moves to terminate student nurses contracts early.

"Yet it is the structure of the economy - and this goes to almost every major city in the UK outside London - that sets us up for a precipitous post-pandemic fall.

Chancellor of the Exchequer Rishi Sunak delivers a summer economic update in a statement to the House of Commons, London (PA Wire/PA Images)

"The crisis highlights how many of society’s key workers – from carers to supermarket employees and delivery drivers – are in extremely precarious situations. Many are on zero hours contracts and already struggled to make ends meet."

Their research also showed that as of the end of June, advertised job postings were down 59% across England, but 72% on Merseyside.

Liverpool's prospects are not improved by the fact its labour market, similar to the UK's, is "deeply imbalanced" - weighted in favour of older and more qualified workers.

With Brexit on the horizon, the situation is not expected to improve any time soon.

Castle Street and Liverpool Town Hall (Colin Lane/Liverpool Echo)

Dr Collins said: "Deregulation is exposing this inequity like never before and a likely no-deal Brexit will surely exacerbate this until there is not a level playing field in sight.

"The UK labour market has largely adopted the flexibility model of core and peripheral workers.

"Core workers are deemed essential to an organisation and tend to be on permanent contracts.

"Peripheral workers, deemed less essential, are more likely to be on temporary contracts and brought in when needed.

"They are less likely to receive training and development opportunities and are more likely to have their wages cut or not have their contracts renewed."

She added: "This flexible model can help organisations respond to changing environments, although it tends to benefit shareholders and higher skilled temporary workers.

"But for each well-paid contractor who advises industry, many more lower-paid gig workers face perilous precarity and, in the ongoing pandemic the possibility of life-threatening work situations, whether in the care sector, distribution centres or otherwise.

"A survey we carried out at Liverpool Business School during lockdown found that 30% of key workers were paid below the living wage and received no holiday pay, whilst 60% received no sick pay.

"If every cloud has a silver lining, then a legacy of coronavirus might well be that key workers are accorded the value they deserve. This includes the essential role played by carers, supermarket shelf stackers, bin men and delivery drivers."

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