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Abstract:

Blog
UK Labour Market Under COVID Part 3: Layoffs, Hiring & Wages
Jonathan Wadsworth
September 2020
Paper No' :


Tags: labour market; covid-19; wages; furlough; recession

Recessions, usually signify a rise in layoffs. Even the last recession, which was accompanied by much more wage moderation than previous ones, generated a significant rise in redundancies. This time it is a little different. Furloughing allows firms to postpone difficult decisions. This can be seen in Figure 1 below which tracks layoffs week by week through the first 26 weeks of 2020 relative to the norms of the past 5 years. While there may have been a small upturn in layoffs from around week 16, it is hard to discern a pattern to weekly layoffs that lies outside the norms of the last 5 years. And since the last 5 years were not recessions, it is hard to see much evidence of layoffs so far.