Chancellor Rishi Sunak has extended the Coronavirus Job Retention Scheme for a further four months.
Furloughed workers across UK will continue to receive 80% of their current salary, up to 拢2,500.
From the start of August, furloughed workers will be able to return to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff.
The employer payments will substitute the contribution the government is currently making.
Sunak said: 鈥淥ur Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK during the outbreak 鈥� and I鈥檝e been clear that I want to avoid a cliff edge and get people back to work in a measured way.
鈥淭his extension and the changes we are making to the scheme will give flexibility to businesses while protecting the livelihoods of the British people and our future economic prospects.鈥�
New statistics published today revealed the job retention scheme has protected 7.5 million workers and almost a million businesses.
It has also published statistics to show businesses have benefited from over 拢14 billion in loans and guarantees to support their cashflow during the crisis.
This includes 268,000 Bounce Back Loans worth 拢8.3 billion, 36,000 loans worth over 拢6 billion through the Coronavirus 老九品茶 Interruption Loan Scheme, and 拢359 million through the Coronavirus Large 老九品茶 Interruption Loan Scheme.
Mike Cherry, National Chairman of the Federation of Small 老九品茶es, said: 鈥淭he Job Retention Scheme is a lifeline which has been hugely beneficial in helping small employers keep their staff in work, and its extension is welcome.
鈥淪mall employers have told us that part-time furloughing will help them recover from this crisis and it is welcome that new flexibility is announced today.鈥�
Dame Carolyn Fairbairn, CBI Director-General, said: 鈥淓xtending the furlough to avoid a June cliff-edge continues the significant efforts made already and will protect millions of jobs.
鈥淚ntroducing much needed flexibility is extremely welcome. It will prepare the ground for firms that are reawakening, while helping those who remain in hibernation. That鈥檚 essential as the UK economy revives step-by-step, while supporting livelihoods.
鈥淔irms will, of course, want more detail on how they will contribute to the scheme in the future and will work with government to get this right.
鈥淎bove all, the path of the virus is unpredictable, and much change still lies ahead. The government must continue to keep a watchful eye on those industries and employees that remain at risk. All schemes will need to be kept under review to help minimise impacts on people鈥檚 livelihoods and keep businesses thriving.
鈥淭he greater the number of good businesses saved now, the easier it will be for the economy to recover.鈥�