UK families see hard times ahead as COVID programs end

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Millions of people across Britain are facing a long, bleak winter as rising cost of living coincides with the end of government programs that once protected homes from the economic fallout of COVID-19.

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LONDON – Diana Gaglio has been in the economic crosshairs of the pandemic for the past 18 months.

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“The market is about to flood,” Gaglio said. “If it wasn’t tough already, it’s going to be tough.”

Gaglio is one of millions across the UK facing a long, bleak winter as rising costs of living coincide with the end of government programs that once protected homes from the economic fallout of COVID-19. Were.

The biggest of those programmes, which sought to preserve jobs by subsidizing the wages of workers whose hours were cut because of the pandemic, ends on Thursday. Some 1.6 million people were still supported by the so-called furlough program this month, down from a high of 8.9 million in May of last year.

Also, the temporary increase in welfare payments expires next week, cutting benefits by about £1,100 ($1,480) per year; And protections are being phased out for renters squeezed by the pandemic. It all comes as 15 million households face a 12% jump in energy bills, adding to consumer price inflation that hit the highest level in more than nine years last month.

Adding to the feeling of despair, drivers are facing long lines to fill their tanks after fuel supply was cut due to truck driver shortage. Newspapers have warned of shortages of everything from toys to turkeys this Christmas unless the crisis is resolved too soon.

“The country and the labor market are in for a really bumpy autumn,” said Charlie McCurdy, an economist at the Resolution Foundation, a think-tank focused on improving living standards for low- to middle-income people. “We can expect a standard of living squeeze for families across the country.”

With front-page headlines shouting “Prepare for a winter of discontent” and “Boris in battle to save Christmas”, the bad news is fueling concerns about Prime Minister Boris Johnson’s leadership and struggling consumers. The pressure is on to do more to help.

Opposition Labor Party leader Keir Starmer on Wednesday scoffed at Johnson’s promise to “level up” income and economic opportunities.

“Level Up?” Starmer said during a speech at the party’s annual convention. “You can’t even fill.”

The government has resisted calls to reverse course, saying the economy is recovering from the pandemic and it is time to end emergency aid programs.

Treasury chief Rishi Sunak said on Thursday that other programs, including job training, recovery loans for businesses and the recent increase in housing benefits, will remain in place. The government has spent £400 billion to support the economy during the pandemic.

“Recovery is well underway, and with over 1 million job vacancies, now is the right time to kick off the scheme,” he said of the furlough program. “But that in no way means the end of our support.”

The UK economy has recovered strongly since the depth of the pandemic, according to the Office for National Statistics, although GDP is about 2.1% smaller than in February 2020.

The recovery has pushed job vacancies to record levels as employers hire employees to meet rising demand.

But while the future may look bright for truck drivers and hospitality workers, things look bleak for other businesses.

According to the London-based Institute for Fiscal Studies, the increase in vacancies is driven by openings for low-wage workers, with more than two-thirds of unemployed job seekers facing increased competition for jobs.

The situation is particularly bad for older employees. Data released by the IFS on Thursday showed that only 35% of workers over the age of 50 found work after six months during the pandemic, compared to 64% of younger workers.

Stuart Lewis, founder of Rest Less, a digital community for people over the age of 50, said his members are concerned about the darkening of the financial situation.

Gaglio is one of them.

Before the pandemic she was a respected manager, booking cabaret artists, comedians and singers for an international holiday company and spending most of her years abroad. Now she is back in England, renting a room in someone else’s house to keep costs down as she tries to get her career back on track.

But she fears that recruiters and employers don’t look beyond her age to see that she is a lively, inquisitive and confident woman.

“Other people see your face and your skin and it’s old – they have a perception of you,” she said. “Maybe they need to know me better.”

Employers are also in a bind.

Tech Tool Shop, a hardware chain that had 12 shops and 50 employees before higher property taxes and the shift toward online shopping, closed three stores in 2019.

The pandemic added to those pressures, forcing the tool shop to close five more outlets last year and merge two others, leaving it with just three stores and 11 staff members. The company developed a multi-year strategy targeting growth and expansion. Now the planning horizon is three months.

The company’s director of human resources, Sarah Adamiston, said the tool shop is hoping customers will return as the pandemic eases and people return to their normal routines.

Tool Shop employee Martin Matteo, 69, is betting that people will recognize that personalized service is valuable and that looking at what you’re buying is better than looking at a small picture on a website.

Matteo quickly shows his understanding of the London house, as well as immediately reminds where the goods can be found in a rooftop shop.

Have a pest problem? He just has a thing. mold? There is no problem.

Return? No questions asked. Jokes? part of the service.

“I believe that physical contact is the most important thing; Customers want to know what they are buying,” he said, comparing retail transactions to courtship. “If I’m going to get married, I want to see the girl.”


Associated Press writer Khadija Kothia contributed.


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