The rapid rollout of COVID-19 vaccines, the reopening of schools and the staggered reopening of other sectors from mid-April should mean that the probable fall in GDP in January proves to be the low point of the year. The extension of the furlough scheme from the end of April to the end of September means that by the time it expires, GDP will probably have risen enough to support a level of employment similar to now. As such, the bulk of the falls in employment may now be behind us. Rather than rise from 5.1% in December to 6.5%, we now think the unemployment rate will peak at just over 6.0% early next year.
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