THE slew of news on the Scottish and broader UK labour market this week has been undeniably grim.

The overall unemployment numbers, while not surprising against the backdrop of the coronavirus crisis and the UK-wide lockdown aimed at slowing the spread of Covid-19 and saving many thousands of lives, are nonetheless both dismal and ominous.

Meanwhile, what is becoming ever clearer is that the effects of the crisis on the labour force have been very uneven by age and pay levels.

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The Resolution Foundation think-tank has published research in recent days revealing the groups hit particularly hard in terms of their jobs and incomes amid the pandemic and, while illuminating and important to grasp in the context of policy-making, its findings add to the gloomy and miserable picture.

The UK Government’s coronavirus job retention scheme has undoubtedly been crucial in the fight to ward off mass unemployment, having protected the incomes of around 7.5 million workers. The figures from the Resolution Foundation, which has described the furlough scheme as “a major public policy success”, also highlight how crucial this Government assistance has been in so far preventing huge additional numbers of people from losing their jobs permanently.

The think-tank has found that 18 to 24-year-olds and workers in their early-60s are most likely to have seen their earnings reduced since the start of the year. And lower earners are much more likely to have been furloughed or to have lost their jobs altogether than those on higher pay.

Around 35 per cent of 18 to 24 year olds, and three in ten workers in their early-60s, are receiving less pay than they did at the start of the year.

Previous Resolution Foundation research has shown that, excluding students, young people tend to be hit hardest during downturns. The think-tank, which has excluded full-time students in its latest analysis published on Tuesday, notes young people are “particularly at risk in the current [downturn] as they are more likely to work in the hardest-hit sectors of the economy, such as hospitality, leisure and retail”. These sectors look likely to be among the ones facing the greatest challenges as the economy re-opens with social-distancing in place.

Young people have already been hit hard in terms of losing work in the current crisis, the Resolution Foundation research shows, with around 23% of 18 to 24-year-olds having been furloughed and 9% having lost their jobs completely.

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A separate report published by the think-tank at the weekend shows 30% of the UK’s lowest-paid employees have either been furloughed or lost their jobs altogether. About 5% of this group have lost their jobs, with 25% furloughed. Among the top fifth of earners, 3% have lost work and 6% have been furloughed, still undoubtedly miserable proportions but figures that are significantly lower than those for the low-paid.

Hopefully, the UK Government will support those hit particularly hard as it sets policy in coming months. It is important it does so not only for the good of the individuals most affected, but also in terms of supporting the broader economy from the point of view of maximising the number of people who have money in their pockets to spend as we move through this crisis.

Figures published this week by the Office for National Statistics show the number of people in the UK claiming benefits because of unemployment surged by 856,500 or 69% between March and April to 2.097 million, exceeding two million for the first time since 1996. In any kind of normal times, such a jump in a single month would be inconceivable.

In Scotland, the number of people claiming benefits because of unemployment jumped by around 75,000 between March and April to 186,000 .

Chancellor Rishi Sunak said last week that the job losses that had occurred so far were “heartbreaking” for him as he extended the coronavirus job retention scheme – which pays 80% of the wages and salaries of furloughed employees up to £2,500 a month – to October.

In recent days and weeks, we have seen a raft of big companies each announce thousands of job losses, highlighting the scale of the challenges ahead.

Engineering company Rolls-Royce has this week announced plans to cut 9,000 jobs, as its civil aerospace business feels the effects of the coronavirus crisis on the global airline industry.

Energy supplier Ovo, which recently acquired SSE’s retail arm and is a major employer in Scotland, has this week unveiled plans to axe around 2,600 jobs. While noting its integration plans would have “always required changes”, Ovo added: “The impact of Covid-19 has now accelerated changing consumer behaviour with more and more customers going online and using digital tools. This has permanently reduced the demand for some functions and roles.”

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Ryanair said recently that it was cutting around 3,000 posts. British Airways last month announced plans to cut up to 12,000 jobs. These are just a few examples of the widespread job-shedding we are seeing.

Individually, the company-by-company job loss figures are grim. Collectively, they are alarming in terms of what the future holds.

It seems like a while ago that we were talking about the possibility of a v-shaped recession, with some hopes of a swift, sharp and strong recovery, but it has only been a matter of weeks.

That said, while things look increasingly difficult, it does seem that there is still more that is not set in stone than in 2008/09, when the global financial system was on the brink of collapse and liquidity had dried up. Hopefully this time, there will be greater availability of credit for businesses getting going again, and patience by banks in dealing with debt already on companies’ books and with consumers’ borrowings, given these unprecedented circumstances. Credit availability and patience will be crucial to allowing businesses to survive, prosper and maximise employment, and could hopefully reduce bad debts for banks in the long run.

The UK furlough scheme is very expensive, costing billions of pounds a month. However, as noted in this column a week ago, the alternative does not bear thinking about and the cost of not having this key support would almost certainly be much greater in terms of the ultimate hit to the public finances from mass unemployment.

There seems little doubt that the UK and the other countries which have implemented similar measures to protect incomes will ultimately reap the rewards of having mitigated the economic damage, as best as they could.

With the furlough scheme, as is often the case in mountaineering, the return journey will be more dangerous, in terms of crucial and difficult decisions by the UK Government about the eventual unwinding of the programme. The decision about the need for the furlough scheme in the run-up to full lockdown was probably relatively simple, given huge parts of the economy were at that stage about to be stopped or reduced dramatically in scale.

The cost of the scheme will naturally reduce significantly as the economy re-opens, with construction re-starting, more manufacturing plants opening up and resumption of activity across various sectors.

However, gradual and gentle withdrawal of the scheme will be vital, as will a sector-by-sector approach, while also taking into account any particular needs of nations and regions of the UK in terms of infection rates. As has been pointed out, the hospitality and tourism sectors may well need the scheme way beyond October. And, while across the economy some companies might be able to contribute to the cost of the furlough scheme as the UK Government envisages between August and October, huge proportions in some sectors struggling to re-open partially or fully will not. To avoid exacerbating the unemployment picture, it will be important for the Government to take into account the different practicalities facing specific sectors in a world of social-distancing.

It will be important not to spook companies, or force their hands, by being unreasonable in terms of expectations of the period over which they will need the furlough scheme, or their ability to contribute.

And, across the economy, flexibility in the furlough scheme will be crucial to enabling companies to take their workforces back on gradually, in terms of numbers and hours worked.

This is all about minimising the undoubtedly huge dislocation.

Employers, the banking sector and the UK Government and devolved nations all have major roles to play in this.

The unemployment figures are grim. However, the furlough scheme has mitigated the damage to a huge degree, and it is crucial that we maximise the long-term benefit of this by taking sensible and pragmatic decisions as the situation develops.

For banks, employers and government, patience will be crucial in this regard.

And it will be vital for the UK Government and the administrations of the devolved nations to ensure those hardest hit by this crisis, among them the youngest and oldest workers and the low-paid, are supported now and not left behind when the recovery eventually comes.