Business bracing itself for an autumn storm as furlough scheme ends

By Ian Mean Business West Gloucestershire director

Business is bracing itself for an autumn storm as the government’s furlough scheme ends which has certainly saved many Gloucestershire businesses from closure during the pandemic.

I estimate that as many as 9,500 people will lose their jobs in the county as furlough ended last week.

I stress that this is my guesstimate because we will not get official Department and Work and Pensions figures until this Friday and those will only be for August.

But the ending of furlough is only part of the challenge for business.

The Covid VAT reduction is now ending hitting hospitality costs particularly hard. Companies’ materials costs are rocketing too at an alarming rate.

And the increase in National Insurance contributions coming in early next year is hitting company confidence, jobs and growth.

I noted a comment in the Financial Times last Friday from Shevaun Haviland, our British Chambers of Commerce director general, who said:

“We were seeing good increases in confidence throughout the summer. But I have been on a number of CEO calls in the last week that we have tried to end on an upbeat note but no one could find one”.

However, here in Gloucestershire I did find some optimism from Steve Gardner-Collins, sales director for the Hatton Collection of hotels and who is director of Visit Gloucestershire.

“I don’t think that as many people as we thought will be losing their jobs in Gloucestershire at the end of  furlough”, he told me.

“But the big question for the hospitality industry here is what will happen in January and February-always difficult months for us- without furlough support.

“And I don’t think that businesses have much choice in not putting their prices up with the increase in VAT.”

He said that there were plenty of jobs available in hospitality alone in the county with around 1341 vacancies-about a third of which were for chefs.

My view is that the over 50s may be the main sufferers from the end of furlough, and many will probably need re-training help.

That re-training needs government support.