British families see hard times ahead as COVID programs end
Diana Gaglio has been in the economic sights of the pandemic for 18 months.
The 53-year-old from Bedfordshire, north London, was put on leave from her job as an entertainment manager for a holiday company when COVID-19 gutted the travel industry, then lost her job completely just before Christmas. Now her temporary job at a virus testing center is coming to an end, just as the government is cutting the emergency program that provided her with an income the last time she was out of work.
“The market is going to be flooded,” Gaglio said. “If it wasn’t hard already, it’ll be harder.”
Gaglio is among millions of people across the UK who face a long, gloomy winter as the rising cost of living coincides with the end of government programs that once protected households from the economic fallout of COVID-19 .
The largest of those programs, which aimed to preserve jobs by subsidizing the wages of workers whose hours have been cut due to the pandemic, ends Thursday. Some 1.6 million people were still supported by the so-called leave program this month, up from 8.9 million in May last year.
In addition, a temporary increase in social assistance benefits ends next week, reducing benefits by almost 1,100 pounds ($ 1,480) per year; and protections for tenants in a hurry by the pandemic are being phased out. All of this comes as 15 million households face a 12% increase in their energy bills, on top of consumer price inflation which has reached the highest level in more than nine years. last month.
Adding to the feeling of gloom, drivers face long queues to fill their tanks after a shortage of truck drivers cuts fuel deliveries. Newspapers are warning of a shortage of everything from toys to turkeys this Christmas unless the crisis is resolved soon.
“The country and the job market are going to have a very turbulent fall,” said Charlie McCurdy, an economist at the Resolution Foundation, a think tank focused on improving the living standards of low- to middle-income people. “We can expect a reduction in the standard of living of families across the country. “
With front-page headlines shouting “Prepare for the Winter of Discontent” and “Boris in the Fight to Save Christmas”, the bad news is fueling concerns about Prime Minister Boris Johnson’s leadership and putting pressure on him to quit ‘it is doing more to help struggling consumers.
Keir Starmer, leader of the opposition Labor Party, mocked Johnson’s promise to “level” incomes and economic opportunities on Wednesday.
“The next level?” Starmer said during a speech at the party’s annual conference. “You can’t even refuel. “
The government has resisted calls to turn the tide, saying the economy is recovering from the pandemic and it is time to end emergency support programs.
Treasury chief Rishi Sunak said on Thursday other programs including skills training, business stimulus loans and a recent increase in housing allowances would remain in place. The government has spent 400 billion pounds to support the economy during the pandemic.
“With the recovery well underway and over a million vacancies, the time has come for the program to end,” he said of the leave program. “But that doesn’t mean the end of our support by any means.”
The UK economy has recovered sharply from the depths of the pandemic, although gross domestic product remains about 2.1% lower than it was in February 2020, according to the Office for National Statistics.
The recovery has pushed vacancies to record levels, with employers hiring staff to meet growing demand.
But while the future looks bright for truck drivers and hotel workers, things are much less promising for other professions.
According to the London-based Institute for Fiscal Studies, the rise in vacancies is due to openings for low-paid workers, with more than two-thirds of job seekers facing increased competition for jobs.
The situation is particularly bad for older workers. Data released Thursday by the IFS showed that only 35% of workers over 50 had found work six months after being made redundant during the pandemic, compared to 64% of young workers.
Stuart Lewis, founder of Rest Less, a digital community for people over 50, said its members were concerned about the deteriorating financial situation.
“We see that there are concerns about the pandemic and the health risks that persist for some,” he said. “There are also additional concerns about affordability, the financial impact as people rush to Christmas. There is a perfect storm of challenges that are on the minds of many people in the coming months. “
Gaglio is one of them.
Before the pandemic, she was a respected manager, booking cabaret performers, comedians and singers for an international vacation company and spending much of her year abroad. Now she’s back in England, renting a room in someone else’s house to cut costs as she tries to get her career back on track.
But she fears that recruiters and employers will look past her age to see the lively, curious and confident woman she remains.
“Other people see your face and your skin and it’s older – they have a perception of you,” she said. “Maybe they need to know me better.”
Employers are also at an impasse.
Take Tool Shop, a hardware chain that had 12 stores and 50 employees before high property taxes and the shift to online shopping, closed three stores in 2019.
The pandemic added to those pressures, forcing Tool Shop to close five more outlets and merge two more last year, leaving it with just three stores and 11 staff. The company was developing a multi-year strategy for growth and expansion. Now the planning horizon is three months.
Tool Shop is hopeful that customers will return as the pandemic subsides and people return to their usual routines, said Sara Edmiston, the company’s director of human resources.
Tool Shop employee Martin Matio, 69, bets people will recognize that personal service is valuable and that it’s better to see what you’re buying than to look at a small picture on a website.
Matio quickly illustrates his understanding of the London home, as well as an instant reminder of where items can be found in a packed store.
Do you have a moth problem? He has just what it takes. Mold? No problem.
Return? No question asked. Jokes? Part of the service.
“I believe that physical contact is the most important thing; customers want to know what they’re buying, ” he said, comparing retail transactions to courtship. “If I have to get married, I want to see the girl.
Associated Press editor Khadija Kothia contributed.