Special thanks to the HR Dept Shropshire for this summary on the announcement made by the government today. (8th July 2020)
Chancellor Rishi Sunak has today revealed the UK Government’s plan for jobs within the second stage of a three-phased approach to economic recovery from coronavirus.
We expect more information to be revealed soon, but below is what we know so far:
- A new Job Retention Bonus will be introduced to encourage businesses to retain furloughed workers. The £1000 bonus will be paid to employers who keep furloughed workers employed at least until 31st January 2021. Terms of the bonus include the employee being brought back to undertake “decent work” and be paid a minimum of £520 on average each month from November – January.
- A new £2 billion Kickstart Scheme will be launched to create fully subsidised jobs for young people. Eligible candidates will be aged 16-24, claiming Universal Credit and at risk of long-term unemployment. There will be funding available to cover the National Minimum Wage of 25 hours a week on six-month job placements.
- Employment support schemes, training and apprenticeships will receive £1.6 billion in funding to assist young job seekers. This will involve:
– £2000 payment to businesses for each new apprentice hired under the age of 25. This is additional to an existing £1000 payment on apprentices.
– £111 million investment to triple traineeships in 2020-2021
– £17 million to triple sector-based work academy placements in 2020-2021
– Almost £900 million to double work coaches to 27,000
– An extra £32 million investment in the National Careers Service - £8.8 billion of new infrastructure, decarbonisation and maintenance projects expected to create tens of thousands of jobs.
- A new Eat Out to Help Out scheme in August providing 50% discount for sit-down meals in cafes, restaurants and pubs to help rebuild the tourism and hospitality sector.
- The rate of VAT applied on most tourism and hospitality-related activities will also be cut from 20% to 5%.
- Funding announced to help the UK get greener and meet Net Zero by 2050.
We anticipate that much of today’s announcements will have a positive impact on the employment sector and that there will be some interesting times ahead for SMEs and people management. Stay tuned as we will continue to provide updates for employers as and when further information becomes available.