Unemployment may top 15 per cent in Wakefield in event of second lockdown, Experian forecast says
Predictions for the local economy by the credit agency Experian suggest businesses will collapse in large numbers if they're forced to close again because of a second Covid wave.
The forecast says under such a scenario, the unemployment rate would reach 15.6 per cent in the district next year.
Assuming an economic recovery takes place thereafter, Experian says the local jobs market would improve in 2022, albeit only very slightly, with 14.3 per cent of working age people potentially out of work.
For context, the latest figures for the district released in June showed the local unemployment rate was 3.9 per cent, although around 47,000 workers were on furlough at that time.
Martin Hathaway, the managing director of the Mid Yorkshire Chamber of Commerce, said he feared the forecast was a "reasonable" estimate.
"I'd love to say otherwise but I think it's a fair assumption," he said.
"When you get to about 15 per cent then that's going back to the levels of the early 1980s.
"I know lots of businesses are very, very concerned, especially about the end of the furlough scheme (in October) and they're thinking they're going to have to make some tough and quick decisions for the future.
"My fear is the end of that scheme may result in many redundancies.
"There's hope that people might be erring on the side of a worst case scenario here, but sadly I think it's a fair assumption."
Mr Hathaway said one forecast he'd seen suggested 57,000 people across the whole of West Yorkshire could be forced out of work by the pandemic if the outlook gets worse.
Gatherings of six or more people from different households will be banned again from this Monday under new government restrictions although concerns have been expressed that the return of schools and universities this month may undermine efforts to control Covid.
Just short of 3,000 new cases were confirmed in the UK on Thursday (September 10).
A report going before Wakefield's senior decision-makers next week said a second lockdown would hit business confidence and prompt, "Households (to) rein back spending; increased business insolvencies and further disruptions to supply chains".
It also said the nature of work in the district meant it was "vulnerable" to further disruption.
It added: "Wakefield’s sector composition is weighted toward businesses in the public sector, manufacturing, real estate, construction and transport and storage industries, which have been less vulnerable to lockdown measures.
"However, Wakefield has a concentration of jobs in elementary occupations, which are more vulnerable to changes such as shifts in working patterns and may be less able to work remotely."
The forecast follows research the Labour Party published this week, which suggested more than 50 pubs across the Wakefield district have closed since 2010.
On a more optimistic note, the council's report said anecdotal evidence from businesses suggested they weren't currently planning to cut jobs because of Brexit, though it warned that that may change in the early part of next year.
Experian's most optimistic forecast for Wakefield, which is based on the assumption there isn't a second lockdown and the economy recovers quickly, puts the unemployment rate at around 6.4 per cent next year.
Local Democracy Reporting Service