The Government introduced furlough as a means to keep workers employed and receiving money despite the lack of work available due to the pandemic. In total 80 percent of wages, up to £2,500 a month, are paid by the Government to those on furlough in a workplace impacted by coronavirus.
Figures from the Office for National Statistics (ONS) found nearly nine million people had to borrow more money because of the coronavirus pandemic by December 2020.
The data also showed the proportion of people borrowing £1,000 or more had increased from 35 percent to 45 percent since June 2020.
The ONS said the “labour market shocks” associated with the pandemic had been felt more by young people and the lowest paid.
They said those aged under 30 and those with household incomes under £10,000 were around 35 percent and 60 percent respectively more likely to be furloughed than the general population.
“Lost jobs, reduced hours, insecure work, meagre sick pay. We have seen some progress but culture and practice remains poor in too many places.
“More action on incomes, protecting rights and employment support is needed if we are to ease the financial pain and insecurity many families are facing.”
The report concluded ministers could better support low paid workers through the crisis by extending “flexible furlough” until the Autumn.
It also called for the continuation of the £20 increase in Universal Credit, a reform to sick pay and investing in skills and improving protections for workers.
Chancellor of the Exchequer Rishi Sunak is due to give his budget on March 3, and could extend furlough for the fifth time.
Bloomberg reported a source close to Mr Sunak had told it “support for jobs isn’t going to end” while businesses cannot open during lockdown.
Mayor of London Sadiq Khan has also urged for an extension of the furlough scheme and a continued business rates holiday past March.
He said: “Current plans to end the business rates holiday in March and then the furlough scheme in April create a huge financial cliff edge for employers.”
“Without the certainty that support will remain in place for as long as it is needed, many more businesses could decide to cut their losses and close permanently now.”