Latest ONS data provided further evidence that the labour market has adapted to lockdown. The number of employees on company payrolls increased by 83,000 in January despite the strict shutdown imposed at the start of the month. Business models have adapted to a new way of working, while the furlough scheme continues to support millions of jobs that can’t presently be done. 

The Prime Minister described his plan to ease England’s lockdown restrictions as a “one-way road to freedom.” But it will be a long and hard road for the labour market to get back to where it was this time last year. Nearly three quarters of a million fewer people are in work, while the unemployment rate continues to creep up despite the extensive support measures in place. 

The Chancellor will unveil further extension of that support at next week’s Budget. That will be necessary to bridge the gap between now and the full reopening of the economy aspired for June 21. We also need to see hiring pick up, but employers now at least have some visibility to help them plan their recruitment strategies for the coming months.