Published: 05/10/2021 By Hauzoo Lettings Team
Throughout the pandemic, the Coronavirus Job Retention Scheme acted as a lifeline to millions of households across the UK, with extensions to the furlough scheme preventing a catastrophic spike in unemployment by protecting jobs and household incomes.From 30th September 2021 the government's furlough scheme has been brought to an end, and employers must decide to either bring workers back on the terms of the original employment; terminate their contracts; or negotiate with their employees to agree to new terms.
Estimates suggest that around 1.7 million jobs were still receiving the benefit of the furlough scheme at the start of August 21, with an independent think tank warning that 900,000 people were likely to be remain furloughed when it came to a close in September 21.
Resolution Foundation believes the end of the Coronavirus Job Retention Scheme is the next challenge for the labour market and that the outlook is hugely uncertain due to a number of different factors. It says that with so many ‘moving parts’ there is a wide range of possible outcomes - but concludes that unemployment is likely to rise.
A spike in unemployment could cause issues for landlords with regards to rental payments and a possible rise in rental arrears emanating from this. On a similar note, some landlords may have been depending on the furlough scheme or the self-employment income support scheme and could be hit hard when this support is taken away, especially if the sector they work in hasn’t recovered well by the start of October. This could cause financial issues for landlords and lead them to seek an exit from the sector, which in turn would cause problems for tenants and the PRS at large.
As a landlord, you should be prepared for the end of furlough and a potential increase in rental arrears or your tenants having financial difficulties. Rent & Legal Protection is a great way to ensure that you still receive the rental payments, even when a tenant goes into arrears.