A QUARTER of British manufacturers say they plan to make redundancies in the next six months after being economically damaged by the coronavirus crisis.
Of those firms planning on laying off staff, more than a quarter involve letting go of up to half of their workers.
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Manufacturing worker inspecting rolls of steel (stock image)Credit: PA:Press Association
The damning warning comes from a new survey of firms by trade body Made UK, which represents 20,000 companies.
Big-name brands including JCB, Renault, McLaren and Rolls-Royce have already announced plans to significantly reduce their staff numbers.
Meanwhile, Nissan and Toyota both closed their UK car manufacturing plants in March, while BMW, Honda, and Ford are among other top manufacturers that have suspended production as a result of coronavirus.
The latest Covid 19 Manufacturing Monitor from Made UK shows just under a third of companies do not plan to make redundancies.
Your rights if you’re made redundant
IF you’re being made redundant, you may be eligible for the below, according to GOV.UK.
- Redundancy pay: If you’ve been working for your current employer for at least two years, you’re usually entitled to a statutory redundancy pay.
- A notice period: According to redundancy law, you’re entitled to a minimum notice period of 12 weeks’ if employed for 12 years or more, at least one week’s notice if you have been employed between one month and two years, or one week’s notice for each year if employed between two and 12 years. If your employer doesn’t want you to work your notice period they can offer you a lump sum instead.
- A consultation with your employer: Employers always have to consult with employees before dismissing them on the grounds of redundancy. In short, your employer must tell you what’s going on and give you a chance to ask questions and raise objections.
- The option to move into a different job: Your employer might offer you “suitable alternative employment” within your organisation or an associated company. Keep in mind that you may lose your right to statutory redundancy pay if you unreasonably turn it down.
- Time off to find a new job: If you’ve been continuously employed for two years, you could be given a reasonable amount of time off to look for another job or to arrange training to help you find another job.
Make UK also warned how almost a third of companies have seen their orders decline by up to 50 per cent.
It added that many manufacturers expect it will take more than a year for normal trading conditions to recover.
Made UK is now calling for a Task Force to be set up to re-deploy employees who’ve lost their jobs.
A smaller scheme was set up after the 2008 financial crisis.
Made UK spoke to 224 companies between May 19 and May 26.
Stephen Phipson, Made UK chief executive, said: “There is no disguising the fact these figures make for awful reading with the impact on jobs and livelihoods across the UK.
“Industry and Government must now leave no stone unturned to retain as many key skills as possible within the sector to ensure it is in a position to effectively recover when growth eventually returns, which at some point it will.”
The job cuts warning comes after Chancellor Rishi Sunak this month warned of a “never-before-seen” recession.
He told MPs the government would not be able to save every job and there could be a long-term “scarring” of the British economy.
The number of people claiming unemployment benefits has soared to 2.1million, rising by 856,500 in April compared to March.
Manufacturing remains in its worst slump since records began nearly 30 years ago, according to the latest manufacturing purchasing manager’s index.
The PMI for the UK came in at 40.7 for May, up slightly on the 32.6 recorded in April but still below the level of growth, IHS Markit data showed.
A PMI reading below 50 indicates a declining market.
