UK survey shows 76% of firms apply for COVID job retention scheme

• Under the scheme, the state pays 80% of the wages of workers who are temporarily laid off.
• The Bank of England has said it is plausible the economy will contract by 25% in the three months to June, before starting to recover.

(LONDON) More than three-quarters of British have applied for the government's emergency -- and hugely expensive -- job retention scheme to help them through the coronavirus lockdown, according to an official survey.

Seventy-six percent of the companies which responded to April 20-May 3 survey said they had applied, the Office for National Statistics said, up from 66% in the previous fortnightly survey by the Office for National Statistics.

The Coronavirus Job Retention Scheme, under which the state pays 80% of the wages of workers who are temporarily laid off, is the centrepiece of Britain's attempts to prevent an expected doubling of the unemployment rate from shooting even higher.

Finance minister Rishi Sunak said on Tuesday the programme was costing about 8 billion pounds ($9.8 billion) a month - about two-thirds of the cost of running England's health service - as he extended it until the end of October.

He also said companies would have to contribute to its costs from August.

The ONS said 22% of businesses which responded to its survey had temporarily paused trading, a slightly lower proportion than previously, but less than 1% had closed permanently.

Official figures on Wednesday showed Britain's economy shrank by a record 6% in March, when a widespread lockdown began towards the end of the month.

The Bank of England has said it is plausible the economy will contract by 25% in the three months to June, before starting to recover.

Forty-four percent of firms in Thursday's survey said their cash reserves would last less than six months.

Sixty-one percent said turnover was lower since the lockdown began and 25% said turnover had fallen by more than 50%. But 32% reported their turnover was within the normal range.

The ONS said just over 5,000 firms responded to its survey, or about a quarter of total it contacted, and its estimates should be treated with caution when used to evaluate the impact of the coronavirus across the economy.