COVID-19 and the UK labour market

• Published in: Oxford review of economic policy Vol. 36; no. Supplement_1; pp. S215 - S224
• Main Authors: Mayhew, Ken, Anand, Paul
• Format: Journal Article
• Language: English
• Published: UK Oxford University Press 01-01-2020
• Subjects: COVID-19; unemployment; scarring; Job Retention Scheme; active manpower policy
• ISSN: 0266-903X; 1460-2121
• DOI: 10.1093/oxrep/graa017

Abstract
This article considers policy responses to the COVID-19 crisis as they affect the labour market, how these policies are evolving and some of the design issues they face. The concentration is on the UK, but other countries are also discussed for comparative purposes. The Job Retention Scheme is a successful innovation to keep temporarily stopped workers attached to their employers. However, since economic recovery will be slow, it is not sustainable in its current form. A sustained rise in unemployment is inevitable and alternative policies to mitigate this and the dangers of scarring are discussed. The structure of output will change, as therefore will the composition of jobs. A comprehensive active manpower policy will be needed to efficiently match job seekers to available jobs. The young are likely to suffer disproportionately from the recession and this makes it essential to introduce radical policies to boost work-based training and to enhance the contribution made by further and higher education institutions.