Budget 2021: Martin Lewis warns of increase in unemployment

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The Office for National Statistics (ONS) said the number of payrolled workers surged by 160,000 in September, when the job ­support scheme ended. Worker numbers are now 235,000 higher than when the pandemic first struck in February 2020. And in a further boost the unemployment rate plunged to 4.3 percent between July to September. The ONS said survey responses so far suggest only a small number of redundancies have been made among the 1.1 million still on furlough when it ended. Vacancies have also hit another record high.

The robust data is reinforcing expectations that the Bank of England will hike interest rates to cool rising inflation before Christmas, if next month’s jobs figures remain as rosy.

The Chancellor, who had been urged by critics including unions and some business groups to extend furlough, said the numbers “are ­testament to the extraordinary success of the furlough scheme and welcome evidence that our Plan for Jobs has worked”.

Mr Sunak added: “We know how vital keeping people in good jobs is, both for them and our economy, which is why it’s fantastic to see the unemployment rate falling for nine months in a row and record ­numbers moving into employment.

“Our Plan for Jobs is at the heart of our vision for a stronger economy.”

The ONS cautioned the full effect of furlough closing may yet be felt, with some workers let go possibly working out notices and on redundancy pay.

Sam Beckett, head of economic statistics, said: “It might take a few months. However, October’s early estimate shows the number of people on the payroll rose strongly.”

Data also showed vacancies soared 222,000 quarter on quarter to a record 1.17 million in the three months to October – 388,000 higher than before the pandemic as firms battle to hire labour.

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