Company payrolls have plunged by 730,000 since the start of the coronavirus crisis lockdown as the UK braces for a feared acceleration in unemployment.
Data released by the Office for National Statistics (ONS) showed 81,000 net fewer people on payrolls last month alone, despite continuing support for employers via government loans and the Job Retention Scheme for furloughed workers.
The figure does not include self-employed workers – also eligible for taxpayer aid.
The ONS said the claimant count – which covers those claiming benefits for unemployment and because they are on low incomes – rose 116.8% to 2.7 million between March and July.
There was evidence too of a wider squeeze on incomes, with regular pay falling by 0.2% in the three months to June compared to the same period last year.
That represented, the ONS said, the first negative growth in regular nominal earnings since records began in 2001.
In the same period, there were 220,000 fewer people classed as in employment – driven mainly by workers aged 65 and over and the self-employed.
That was the worst quarterly performance since the financial crisis recession of 2009.
The official jobless rate remained static at 3.9% which the number-crunchers said could be explained by the fact that many workers could not be classed as unemployed because they were not actively looking for a job.
The figures were released hours before the Treasury confirmed businesses had secured government-backed loans of almost £52bn to date with 9.6 million workers’ pay supported through the Job Retention Scheme.
The figures do not show how many people are currently still receiving support through separate survey findings by the ONS released a fortnight ago suggested that roughly a third of that number had returned to their jobs amid the gradual re-opening of the economy from its COVID-19 hibernation.
But there are predictions of an acceleration in job losses ahead as the wage support is tapered before being withdrawn completely in October.
Last week, the Bank of England warned the jobless rate could hit 7.5% by the year’s end.
The travel sector and retail have been among the major employers cutting back on staff already, though research by technology recruiter Harvey Nash suggests sectors hit less hard, including pharmaceuticals, logistics and healthcare, are continuing to create jobs.
Commenting on its findings, ONS deputy national statistician for economic statistics Jonathan Athow said: “The labour market continues recent trends, with a fall in employment and significantly reduced hours of work as many people are furloughed.
“Figures from our main survey show there has been a rise in people without a job and not looking for one, though wanting to work. In addition, there are still a large number of people who say they are working no hours and getting zero pay.
“The falls in employment are greatest among the youngest and oldest workers, along with those in lower-skilled jobs.
“Vacancies numbers began to recover in July, especially in small businesses and sectors such as hospitality, but demand for workers remains depressed.”