Alan Price, employment law expert and CEO of BrightHR, the international HR software and employment law and HR advice service, said the Chancellor’s economic update would be welcome news for businesses across the UK, many of which will have been concerned about the implications of the ending of the furlough scheme in October.

Price said: ‘The bonus that will be paid to employers if they can retain staff does provide them with a lifeline, and incentive, to keep staff on post-October. Ideally, this could help employers to avoid a redundancy situation, something that many may have feared they would face before the end of what has already been a challenging year.

‘Mr Sunak’s statement also goes beyond the furlough scheme, outlining plans to both create, and encourage, the creation of new jobs and opportunities for those who may struggle to find employment as a result of the coronavirus pandemic.

‘The £2,000 apprenticeship bonus may make providing such an option considerably more attractive to businesses.

‘At the same time, the “kickstart” scheme may also prove to be a cost-effective method of sourcing young workers who can progress within the company.

‘Employers should bear in mind that on-the-job learning has proven to be invaluable for finding efficient members of staff, and now face a situation where adding this into their company would be considerably less expensive than usual.’

 Justin Rix, head of people advisory, Grant Thornton, agreeing, saying: ‘What the bonus may do is encourage some creative thinking from business about how they can help their furloughed workers to acquire the new skills to be able to fulfill new roles in the organisation.

‘In order to do this successfully, businesses will need to carefully consider reintegration and retention strategies for their employees.’

However, Rix cautioned that if a business has already identified roles that are either not needed or cannot be afforded in the longer term, then the short term benefits of the bonus may not be enough to encourage a significant change in strategy.

PwC chairman and senior partner, Kevin Ellis, described the Chancellor's plan for jobs as a considerable economic stimulus, which reflected the scale of the challenge and the need for speed to create a difference.

‘It’s good to see focus on the “Covid-generation” such as through the apprenticeship scheme. Young people have been disproportionately affected by unemployment related to the pandemic and our economy cannot recover without them.

‘Many of today’s initiatives have a time-window, reflecting that this is a call to arms now.  But investment in skills and investment in “green jobs” will pay dividends longer term,’ he said.

This point was echoed by Yael Selfin, chief economist at KPMG UK, who said that given the scale of unemployment expected in the second half of this year, a major ramp-up in training is required to help those affected find new opportunities. 

‘It will require a new approach, with a flexible national training programme set up to upskill and retrain large numbers of people. It also needs to be designed and delivered together with businesses across the regions, and focused on equipping those who lost their jobs with the skills needed to go back to work in the growth sectors of the future,’ she said.