‘3,000 jobs could go in Redcar and Cleveland’ because of coronavirus

The stark warning came at a meeting of the authority’s growth, enterprise and environment improvement committee.

There are fears that firms will begin laying staff off when Chancellor Rishi Sunak’s job retention scheme – which pays for 80 per cent of the salary of workers placed on furlough – ends in October.

Margie Oliver, the council’s service lead for business and skills, said economic modelling suggested about 3,000 jobs could be lost between now and early next year in Redcar and Cleveland because of the coronavirus crisis.

She said: “The actual picture may be massively different for all we know, but that is the forecast figure as a result of covid-19.

“They are large numbers and we are obviously trying to encourage and accelerate as many investment projects as possible to try and mop up some of the people affected by this.”

Ms Oliver said there was particular concern around the impact on young people, who were expected to bear the brunt of any redundancies.

Official figures show that between April 2019 and March this year the unemployment rate in Redcar and Cleveland stood at an average of 6.1 per cent.

This compared to 5.6 per cent for the North-East as a whole and 3.6 per cent in England, Scotland and Wales.

Meanwhile, in June this year 13.4 per cent of 18-21 year olds in the borough were claiming benefits principally because they were unemployed.

This compared to 10.6 per cent in the North-East and 8.8 per cent in England, Scotland and Wales.

Ms Oliver said work was taking place in conjunction with JobCentre Plus on a pilot scheme which could see a new youth employment hub created in the borough, along with other locations across the country.

Redcar’s Conservative MP Jacob Young said he was greatly concerned  to hear of the council’s gloomy jobs forecast.

He said: “We have always been honest with the public that not every job could be saved.

“The Chancellor told the House of Commons that the independent Office for Budget Responsibility and Bank of England were both projecting significant job losses.

“But rather than simply accept mass unemployment as the inevitable result, the Government has announced a raft of extra measures designed not only to protect jobs, but also to create new jobs as we kickstart the economy following lockdown.

“To help councils like Redcar and Cleveland weather the storm, the Chancellor has brought forward a lot of funding that was originally scheduled to be released at a later date.”

Mr Young said a ‘Town Deal’ funding pot would allow the council to drive jobs and growth for Redcar.

He added: “Then there is the £750,000 of decentralised funding released to the council to spend on a shovel ready project.

“Add to that the Kickstart Scheme which will directly pay employers to create new jobs for any 16-24-year-old at risk of long-term unemployment.

“We are also doubling the number of work coaches in JobCentres, increasing the Flexible Support Fund, extending the Rapid Response Service, expanding the Work and Health Programme and developing a new scheme to support the long-term unemployed.

“Hard times are ahead, but support is there and it will continue to be there until the recovery is in full swing.”

Simon Clarke, Conservative MP for Middlesbrough South and East Cleveland, said: “From the onset of this crisis the Government has been clear that this is not only a health emergency, but an economic emergency too.

“These are incredibly difficult times for our region in particular.

“It’s no secret that we entered into this crisis at an economic disadvantage when compared to other regions around the UK.

“But with the Government committed to placing Teesside at the forefront of its plans for economic recovery and with infrastructure work at the newly named Teesworks getting underway, there is a bright future for our region.”