Older workers are at most risk of being made unemployed in the second half of the year as the government’s furlough scheme is phased out, according to a leading welfare thinktank. The Resolution Foundation said the chancellor’s decision to wind down furlough support for employers from today would endanger the jobs of more than one in four workers aged 55 to 64 who have remained on the scheme since the recent lockdown. While many of the workers furloughed during three lockdowns since March 2020 were younger, the age profile has changed as hospitality and leisure businesses have reopened and brought back under 25s into full-time work. The Foundation’s annual Living Standards Audit 2021 found that 1.5 million of the 10 million workers furloughed last year were back working in May, and just 3% were out of work. “But with the rapid fall in furlough rates driven by the reopening of sectors like hospitality and leisure, which disproportionately employ younger workers, the age profile of the over 1.5 million employees still on furlough is changing,” it said. The report shows that of the workers still on full furlough in May, 26% were aged 55 to 64 while just 6% were between the ages of 35 to 44, and 16% aged 18 to 34. “This pattern of younger workers more swiftly returning from furlough has resulted in older workers on full furlough bearing the highest risk of having been out of work for long time periods,” the report said. The furlough scheme provides employers with 80% of a worker’s salary up to a cap of £2,500 a month. From 1 July employers must continue to pay 80% of salaries to qualify for the scheme, but they will receive only 70% of that sum from the government, meaning employers have to find 10% of the wage bill themselves. From August until the end of September, when the scheme ends, employers will have to pay at least 20% of a worker’s salary, with the government picking up 60% of the wage. Aside from older workers, some of the groups likely to be still furloughed, the IFS said, include Londoners, women, and workers in the cultural, accommodation, and food sectors. The Institute for Fiscal Studies warned the extra costs will lead to tens of thousands of workers suffering a steep fall in income as employers react by making redundancies. Workers who live with higher earners will be unable to claim benefits and could see their income drop to zero should they lose their job. Families with children could lose as much as a third of their income if they are forced to rely on universal credit, the thinktank said. “It will mean big income losses for many of those who end up unemployed unless they are swiftly able to find alternative employment,” the IFS said. The drop will be even larger should the government press ahead with a £20-a-week cut in universal credit, as planned in September, the report added. The Treasury’s independent forecaster, the Office for Budget Responsibility, estimates that the government’s outlay on the furlough scheme peaked at £10bn a month before falling to an estimated £2.2bn in June. A single person earning £37,500 a year will receive £30,000 under the furlough scheme, but if they are forced to claim universal credit they will receive just £3,750 or £1 for every £8 received in furlough, the report said. If their partners are higher earners they will be excluded from universal credit.