Airport towns braced for jobless spike as furlough scheme ends

Airport hubs Crawley and Luton are facing a sharp jump in unemployment this week as Britain’s furlough capitals bear the brunt of an end to the Chancellor’s jobs support scheme.

Experts warned the towns are the most vulnerable to a wave of job losses after new data revealed they have the most workers stuck on furlough as the travel industry struggles to recover.

The recent loosening of Britain’s travel rules came too late to save the sector’s crucial summer period. The furlough scheme wraps up after 18 months on Thursday.

Crawley, which is close to Gatwick airport, is most threatened by a surge in unemployment with one in 10 of its workforce still on the furlough scheme as of the end of July, according to Centre for Cities figures.

Luton could soon have Britain’s highest claimant count rate. It already has the fourth-highest share of its population on jobseekers’ help but also has 8pc of the workforce stuck on furlough.

While Slough, which is near Heathrow, has a lower claimant count rate than Luton, it is also highly vulnerable, with 9pc of its workers on furlough.

Paul Swinney, director of policy and research at Centre for Cities, said: “The places that continue to be particularly exposed tend to be those airport towns, particularly those close to London which were clearly handling a large volume of traffic in normal times.

“The scheme is removed at the end of this month: that clearly is really big for places like Crawley, Slough and Luton where a large share of people relatively speaking continue to be on furlough.”

It came as economists also warned that staff shortages are being worsened by about 1m workers leaving the labour market as many Britons retire early and go back into education.

The Institute for Employment Studies estimates that an extra 300,000 more workers have retired early as a result of the pandemic, deepening the shortages crippling many sectors.

Tony Wilson, director of the IES, said: “That’s massive and easily as big as the impacts from migration, from young people studying and furlough.

“The things that are driving high levels of vacancies is that there are just fewer people in the labour market.”

An extra 500,000 to 600,000 workers are believed to have gone into education or have migrated.