The video discusses the challenges and strategies associated with the furlough scheme implemented to address unemployment during the COVID-19 pandemic. While the furlough scheme has successfully mitigated a spike in unemployment, its prospective end raises questions about whether it prevented a jobs crisis or merely postponed it. With sectors like retail, leisure, and hospitality still struggling, the video explores whether the scheme should be extended or if efforts should shift towards retraining and aiding the unemployed to adapt to an evolving economy.

The discussion features perspectives from Francis O'Grady, General Secretary of the TUC, and Jonathan Portes, Professor of Economics at King's College London. O'Grady advocates for extended support to viable businesses and workforce retraining, while Portes emphasizes the importance of moving beyond "zombie jobs" and preparing unemployed individuals for emerging opportunities. Both agree that careful management is essential to foster a dynamic labor market without stifling economic recovery.

Main takeaways from the video:

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Key Vocabularies and Common Phrases:

1. suspended animation [səˈspɛndɪd ˌænɪˈmeɪʃən] - (noun) - A temporary stop in an activity or process, likened to a state of dormancy. - Synonyms: (pause, halt, standstill)

Boris Johnson has called it suspended animation. 9 million people at the peak being paid not to work.

2. looming [ˈluːmɪŋ] - (adjective) - Appearing as a large, indistinct, and threatening form. - Synonyms: (imminent, impending, threatening)

And now a looming policy challenge how to restart and how to manage the fallout from furlough.

3. outlier [ˈaʊtˌlaɪər] - (noun) - Something that stands out from others, especially by being different from the norm. - Synonyms: (exception, anomaly, deviation)

The UK is starting to look like an international outlier.

4. constraints [kənˈstreɪnts] - (noun) - Limitations or restrictions on a process or function. - Synonyms: (limitations, restrictions, restraints)

They're still facing both supply constraints on how they operate and also weak demand.

5. targeted support [ˈtɑːrɡɪtɪd səˈpɔːrt] - (noun phrase) - Assistance directed towards specific groups or areas in need. - Synonyms: (focused aid, specialized assistance, directed support)

But there is an argument for targeted support, but I think for the broader retail, accommodation, food service, etcetera.

6. retraining [riːˈtreɪnɪŋ] - (noun) - The process of learning new skills to replace or enhance existing ones. - Synonyms: (reskilling, upskilling, education)

Better, some say, to increase unemployment benefits and spend public money retraining people for new jobs in growing areas.

7. zombie jobs [ˈzɒmbi dʒɒbz] - (noun phrase) - Jobs that are unlikely to be sustainable in the long term but are temporarily maintained by support measures. - Synonyms: (unsustainable jobs, precarious positions, futile employment)

One concern is that furlough could mask what are sometimes called zombie jobs.

8. viable [ˈvaɪəbl] - (adjective) - Capable of surviving or continuing in a successful way. - Synonyms: (feasible, workable, sustainable)

But I think what we're looking at now is the risk that the chancellor pulls the plug on all that good work when there are still companies and jobs with a viable future that need a bit more help to keep going.

9. spillovers [ˈspɪlˌoʊvərz] - (noun) - Unintended consequences or side effects of an action or decision. - Synonyms: (repercussions, effects, by-products)

Because there are broader impacts and spillovers that we want to preserve.

10. dynamic [daɪˈnæmɪk] - (adjective) - Characterized by constant change, activity, or progress. - Synonyms: (energetic, lively, vigorous)

The turnover in the labor market is very large, and that's part of what makes the economy work, what makes it dynamic.

What will happen when the Chancellor turns off the furlough tap? - BBC Newsnight

Boris Johnson has called it suspended animation. 9 million people at the peak being paid not to work. Tens of billions of pounds for people to stop commuting, stop laboring, stop meeting. And now a looming policy challenge how to restart and how to manage the fallout from furlough.

The jobs retention scheme is widely acknowledged. You have stopped a huge spike in unemployment, but it will be judged on whether that jobs crisis is prevented or just delayed. The government says that furlough will taper off and finish at the end of October and that companies and workers have to adjust to a new economic reality.

But Germany is tomorrow expected to extend its furlough or short work scheme. France, Spain and Italy either have extended or are likely to extend their programmes. The UK is starting to look like an international outlier. There are still millions of people in the job retention scheme. This is one estimate of the numbers of people furloughed from survey data. But new figures last week showed that actually the numbers are higher than previously thought. At the end of June, 6.8 million people were still in the scheme. Resolution foundation estimates that 4 million people remain fully furloughed today, with more on a part time basis.

The problem is the economy is still, you know, facing substantial amounts of weakness. And in particular, some sectors of the economy are so retail, leisure, hospitality and some other sectors, you know, they're not going to be bouncing back immediately. They're still facing both supply constraints on how they operate and also weak demand. Similarly, if we see local lockdowns, there's good reason to support jobs alongside any measures that restrict economic activity in particular areas.

One concern is that furlough could mask what are sometimes called zombie jobs. The argument is that the scheme keeps jobs going at companies or in sectors that simply aren't going to recover to full strength after the pandemic. Better, some say, to increase unemployment benefits and spend public money retraining people for new jobs in growing areas.

Germany looks set to extend its short work scheme despite lifting lockdown restrictions earlier than the UK. And an overhang of worries about what might happen in November is the last thing the UK economy needs. It's an economy that's very dependent on private consumption, so you definitely want to avoid a situation where the consumer feels very uncertain about the economic future and hence it's particularly important to keep support programs in place to not jeopardize economic recovery.

What I recommend is that you run two strategies at the same time, so you have the blanket safety net of Kurzerweil or short work schemes in place, but you have to complement it with active labor market policies, such as, for instance, hiring bonus, to ensure that there is still mobility within the labor force.

Is the end of furlough the first step to rebuilding a new, changed economy after Covid, or is the scheme still a vital protection in these most unpredictable times? Helen Thomas, well, joining me now is the general secretary of the TUC, Francis O'Grady, and Jonathan Portez, professor of economics at King's College London. Good evening to both of you.

Frances O'Grady, first of all, Rishi Sunak said there's going to be hard times. He shouldn't pretend that in every case is a job to go back to, surely, because look, for example, straightforwardly at John Lewis, British Airways and so forth. Well, back in March, when the TUC first spoke to the chancellor, he said he would do whatever it takes and that he would set aside.

And it was the first time that the UK introduced a wage subsidy scheme, because as long as people are working, they're spending locally in shops and businesses, and they're paying their taxes and keeping the economy running. So it's a legitimate goal. Full employment is the best way to get the economy back on its feet.

But I think what we're looking at now is the risk that the chancellor pulls the plug on all that good work when there are still companies and jobs with a viable future that need a bit more help to keep going. And I think there are models, like in Germany. I know Ireland is actively considering looking at a combination of short time working so people can share work, work part time, and use the remainder of that working week for upskilling and retraining.

And that, to me, seems the kind of flexible, targeted approach that makes sense. Jonathan Porters, are we, though, going to see much of our manufacturing simply disappear at the end of this? No, I don't think so. Most of manufacturing is already well on the way back to normal working, and I think we have to.

I don't disagree with a lot of what Francis said about what the furlough scheme has achieved so far and the need to maintain incomes and to have the objective of full employment. The question is how that's best achieved. And I think the risk is that extending the furlough scheme freezes a situation in place where there are firms which have no realistic chance of medium to long term survival, jobs that have no medium to long term chances of survival.

And what you need is to help those people into new jobs. That does mean zombie. The idea of these zombie jobs, which is going to your life's, an aspect of. But at the end, it's of no value to you. That is a phrase that I used in my article. And I said, we need to redirect our support towards helping the unemployed. And remember, there are already a very large number of people unemployed, and that will get much, much worse when young people leaving school, the university, come onto the labor market in September.

So creating new jobs and training people for new jobs, in my view, should be the priority, not preserving old jobs. And I just, you know, you mentioned John Lewis and Marksdehe Spencer. All that is true. But remember the british economy, about 6 million people leave their job every year, either for unemployment or to take up a new job at a new firm. The turnover in the labor market is very large, and that's part of what makes the economy work, what makes it dynamic, what enables us to grow.

And you can't freeze that indefinitely, and you don't want to. And Francis Grady, what uses it to somebody who is furloughed for two years, the impact on them knowing that without retraining, without doing something else, they're facing the chances of not having a job at the end of furlough anyway. Is it not better, as Jonathan Porter is saying, to retrain, to put people into a position where they're able to take a job in the new economy?

Look, I think it has to be something for something. And we've argued all along that companies should produce jobs and skills plans for their workforces. And let's remember that we have seen, for example, manufacturing companies switched production to produce PPE at the time of crisis. So, of course, in many cases, firms will need to adjust their strategies, but they need time and support to do that.

And none of these strategies are mutually exclusive. Of course, we need quality job creation schemes. We need investment in skills and retraining. But let's remember that it is young people who are on the front line of these job hits, in retail, in hospitality and culture. And there is a future for those industries once we get this pandemic under control.

And frankly, it would help if we genuinely had a world beating track and trace system to help us get there. Jonathan Porters, do you think that there's an argument for sectoral support for particular areas? Look, you know, look at event spaces, look at theaters, look at the cultural community that actually, if these are to survive at all, then the chancellor has got to spend some money on those in the coming months.

I think there is an argument for those very rather small number of sectors and places who are actually still restricted by the lockdown and where we know for wider reasons, economic or social, because there are broader impacts and spillovers that we want to preserve. Those sectors, like some parts of the culture sector, there is an argument for targeted support, but I think for the broader retail, accommodation, food service, etcetera, which is where the bulk of the jobs that we're talking about, these are sectors that are already, put it one way, very dynamic, put it another, have very high turnover.

But what happens, professor, but. Sorry, just. I just needed to ask you one thing, because we're looking. We had this before when we're talking about schools, the idea that we're coming into a phase where there'll be localized lockdowns, how disruptive that will be to the economy.

I think, and I agree entirely with Francis here, the priority here has to be getting on top of the virus in order to enable us to get out of this, in order to create new jobs and let those firms which are potentially viable, recover. The priority, really, is to ensure that whatever, while there may need to be local lockdowns, we don't go into anything like a national lockdown.

So that means providing targeted support. It means providing sick pay, proper, generous sick pay to people who have to take off, take work off because they're being isolated. All of those things which the government hasn't done very well on so far. There is no trade off between health and the economy here. We need to beat the virus so that we can restart the economy.

Finally, Francis, know the debt's at 2 trillion at the moment. It costs 60 billion for the whole scheme so far. You know, do you think the government can afford another 60 billion for another furlough for twelve months? Well, I think the truth is that the government can't afford not to support economy and jobs because it would be a disaster for the country and a disaster for working families if they don't.

And it is important to remember that many of these jobs have a good future. But we are still in this rocky period when we are facing local lockdowns through no fault of their own. Companies will be required to close if there is an outbreak, for example, locally. And we've got to get away from this kind of collective punishment into collective support for working our way out of the crisis. Thank you both very much indeed for joining us.

Economics, Politics, Global, Furlough Scheme, Job Retention, Economic Recovery, Bbc Newsnight