The ONS has revealed that the unemployment rate has risen by 0.5 percentage points to 4.3%. It’s up 0.3 percentage points from its pre-pandemic level.
The employment rate has also dropped 0.5 percentage points to 75.5%, according to ONS figures. It’s down 1.1 percentage points from its pre-pandemic level.
What does it mean?
Sarah Coles, head of personal finance, at Hargreaves Lansdown: “Gloom is starting to settle in across the employment landscape. We’re not seeing a deluge of job losses or redundancies, but the steady creep of bad news means that for some people, the outlook is increasingly ominous.
“Throughout the turbulence of the last couple of years, the one thing we’ve been able to cling to was job security. And while we’re not facing sweeping job losses, it’s worth at least considering what we’d do if the tide was to turn.”
If you’re concerned about the future of your job, there are 7 steps you can take to get yourself in the best possible position to deal with what the future may hold.
1) Get ready to job hunt
Job hunting can be hard work, but the more you’ve warmed up, the easier it is to get started. This includes everything from updating and polishing your CV, to spending some time getting back in touch with your network – both in the real world and through social media like Linked In. You can also sign up to job sites, so you have an idea of what’s out there right now.
2) Consider your options
Think about whether there’s anything that could make you more employable. It may be that there’s some training or experience you can get while you’re still in work that will make it easier to find a job later. It’s worth taking advantage of what’s on offer while you can.
3) Baton down the financial hatches
You need an emergency budget, which covers the essentials while you’re not working, and keeps your expenses to a minimum, so you can stop cash leaking on day one. If push comes to shove, and you need to implement the emergency budget, don’t assume there’s no wiggle room at all on your commitments. For major outlays like the mortgage, it’s worth talking to your lender to see whether you can work out an affordable payment plan in the short term. Even for smaller expenses like media packages or gym membership, get in touch and explain your circumstances, and they may well suspend the services for a period.
4) Work on your emergency savings safety net
Ideally, we should all have 3-6 months’ worth of essential spending in a competitive easy access account for precisely this kind of eventuality. If this kind of sum has been impossible to build, don’t panic, your aim should be to put aside as much as you can afford, as soon as you can afford to do so. You’ll be grateful for every penny.
5) Keep a close eye on the lay-off process your employer follows
Depending on how long you have worked for them, and how you’re let go, there may be redundancy pay available. If in doubt, it should be in your contract. Your employer should also go through a specific process to make sure the redundancy is done fairly. If you don’t think it’s fair, you can speak to a union or staff representative if there is one. If not, you can approach ACAS for advice. You should also make sure you are able to work your full notice period and are paid for any holiday you haven’t taken.
6) Explore any help that’s available
If you have a gap between employments, you may be able to get help from the government – like new style Job Seekers’ Allowance, Universal Credit, and any help with housing costs. There will be a gap between claiming and receiving any benefits, so it’s worth starting as soon as possible. If you’re not sure where to start, organisations like Citizens Advice and Money Helper have lots of information online.
7) If you find a job quickly, consider the best possible use for any remaining redundancy pay
While you’re out of work, you’re likely to have focused on paying off expensive short-term debts and supplementing your income. Now you can consider rebuilding your emergency savings and boosting your pension. If you already have work to go to when you’re made redundant you can consider redundancy sacrifice. The first £30,000 of redundancy pay is tax free, but after that, your employer may be prepared to pay some of the taxable portion as pension. This is not only tax free, but they’ll also save National Insurance, and may agree to pay this into your pension too. If they won’t consider redundancy sacrifice, you can just pay into a pension yourself, and claim any additional tax relief that may be due.