Why has furlough been extended to the end of March?

[Hyperbolistic]

Lockdown 2 supposedly finishing on December 2nd so why extend furlough for so long?

my company gets very quiet anyway through December and early to mid jan, so can't see that they would have kept anyone on for that period. .

maybe financial year budgeting to give companies a chance to use their new years worth of funds?

Good question OP, I wondered that. It will be out of economic necessity not the goodness of their hearts.

Because they know its going to be a bad winter and we will likely be in some form of lock down till then.

Because industries like travel will be damaged till then and it is better for the economy to support them rather than have them go bust.

Probably because Covid isn't going to magically disappear on the 2nd of December and we're going to have to put up with this shit for months.

To allow businesses to plan as much as they can.

BecUse even after lockdown hospitality and other industries won’t be able to operate as normal.

When we come out of lockdown we go back to tiers where there will be businesses that can’t operate and will need support.

I expect there will be a third lockdown before the end of March and it's to support businesses which are less busy in January and February and won't have had the opportunity to build up funds in an extended run up to Christmas, e.g. the hospitality sector and some retail.

An awful lot of companies using furlough are in the hospitality, tourism and non-essential retail sectors who typically experience their quietest months from January to March even at the best of times, but usually ride through it on the huge boost they've had in November & December. They won't get that boost this year.

I think we need to prepare to see a lot more businesses (both independent and chains) go under before next summer.

In and out of lockdown to get us over the winter and until a vaccine has been rolled out (hopefully!)

Many hospitality, heritage sites and visitor attractions earn most of their money from April to September. This year they didn't earn the money to keep them going through the leaner winter months (which are likely to be even quieter this year). Without furlough they won't make it to spring when hopefully they can begin recovery. Charities only are allowed to keep a certain reserve of funds, which are becoming lo w or non existent now.

Because it’s very clear there will be more lockdowns after December.

Lots of business still haven’t been able to get people back to work at all due to ongoing restrictions. I do hope it’s not being abused this time though, and hope it will only be used by those who genuinely need it.

Because :
We won’t magically go back to full capacity on Dec 3rd

Because hospitality, travel, leisure and theatre are still going to have heavy restrictions and much much lower capacity

Because so many people were made redundant at end of October as there was no “further” lifeline

Because it will enable companies to keep all/most/as many employees as possible and enable part time work/part time furlough without a detriment to staff or company

It also makes the accounting in companies simpler by doing a full tax year - although this is minor, as it has never been done or needed before, it has taken longer for accounts to be audited than normal

Because the economy won’t automatically recover at the beginning of December.

Oh and hospitality has lost out on Easter (huge), summer (EOTHO was helpful but we had great weather and so at 100% capacity it would have seen though darker days - it hasn’t) and now Christmas which is a huge hit.

E.g if a hospitality business made £100,000 pa 75% of this can be attributed to Easter, July -August, October half term and 6 weeks of Xmas. Breaking it down it’s approx a 1/4 of the year making money that provides for the remainder

When I heard that they were extending furlough it made me feel quite hopeful that the government know more about the vaccination than they're saying and think things will be looking much better by the spring. Probably hopeful thinking but you have to keep positive!

Germany have furlough until Dec 2021

Just because they end the lockdown in December, doesn't mean places won't be tier 3 when it's over, so furlough needed for that I guess.

Because they know that it’s going to go on for a very long time.

I think it is to give businesses and employees a but of long term hope / security. Rather than worrying if next month they will have no job, they now know that they'll be looked after for the next 4 months, which will be a bit of peace of mind for them.

Also even if we do "unlock" on December, many businesses wont be able to run at full capacity- just as they havent been able to from August to November. Just one example, restaurants closing earlier and with fewer tables need fewer staff, so the others will be able to be furloughed.

It also means the government wont be spending time making decisions over the furlough scheme for a few months, so can put those efforts towards other things.

To continue financially supporting businesses that may not be able to just start back up again.

To tide us over the shit show that will be Brexit.

To spread the potential lay offs

Some have already happened (yes, if extension dates had been announced differently, then some redundancies might not have happened, but were those businesses moribund). They happened late Oct/early Nov - ie well before Xmas

There should not be need for more before Xmas, which will be good for morale, and then there's time for each business to work out its viability in the New Year.

Slightly surprised that it goes as far as March though. Though if hoping for greatest number of businesses to survive with fewest layoffs, I can see some sort of logic, especially if they expect the initial lifting of restrictions to be into tiers

I think it’ll be a rolling month on/month off of lockdowns until the end of March. Hospitals don’t struggle from April onwards in the same way they do in the winter. It’s not just flu that increases hospital admissions. There’s more falls in winter, more car accidents, more cardiac events, more suicide attempts, more hospitalisations of other respiratory conditions.

I’ll be very surprised if there isn’t another lockdown in January.