There are concerns that the end of the government’s £70bn furlough scheme today could lead to an increase in redundancies as employers once again become responsible for paying their staff's wages.
More than a million people are still on the scheme and economists have warned that the end of furlough could spark a rise in unemployment.
During the pandemic, the furlough scheme subsidised the wages of more than 11 million jobs.
According to figures from the Office for National Statistics, there are over a million job vacancies in the UK, particularly in hospitality and transport.
Chief Secretary to the Treasury Simon Clarke told Sky News: "There is a lot of opportunity out there for people now. There's never an easy moment to end these measures.
"They've been hugely important but it is also time to recognise that we are now, thankfully, out of the teeth of this pandemic... and we're in a situation where normal opportunity is back out there for people to embrace."
But economists have warned that although some of those coming off furlough are likely to find jobs in travel and hospitality, there is a strong risk of a rise in unemployment due to new redundancies.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, doubts whether the economy had recovered enough to re-employ all those coming off furlough, the Guardian reported.
“While the unemployment rate probably will rise only to about 5% in the fourth quarter of 2021, from 4.5% in the third quarter, we expect underemployment to rise sharply, as people return to their former employers, but work fewer hours than they would like,” Tombs said.
“As in the early 2010s, this reservoir of ‘hidden’ labour market slack should exert considerable downward pressure on wages.”
The government has launched a £500mln support package for vulnerable households over winter, Sky News reported.
Chancellor Rishi Sunak said: "With the recovery well underway, and more than one million job vacancies, now is the right time for the scheme to draw to a close.
"But that in no way means the end of our support. Our Plan for Jobs is helping people into work and making sure they have the skills needed for the jobs of the future."
Meanwhile, in a letter to the chancellor, Liberal Democrat Treasury spokesperson Christine Jardine has called for furlough to be maintained for another six months for 10 industries particularly badly affected by the pandemic, such as air travel, according to Sky News.
"The withdrawal of furlough risks having a devastating impact on countless families already facing a winter of soaring energy bills," said Jardine.
The party believes the extension would cost about £600mln.
The Guardian reported that the TUC has called for the furlough to be used as the basis for a permanent short-time working programme like the one implemented in Germany.