Employers will have to take on more of the costs of furlough from today (July 1) as the government starts to wind down the Covid job support scheme.
The change will affect thousands of firms across the country with about 1.5 million workers still on furlough.
Staff will continue to receive 80% of their wages, but employers will pay part of that for the first time.
That could prompt layoffs, with older workers at greater risk of redundancy, one think tank warned.
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The Institute for Fiscal Studies said the bill for employers keeping a member of staff on the scheme would rise from £155 per month currently, which covers costs such as National Insurance, to £322 in July and £489 in August and September.
As a result, firms might reconsider whether they will retain staff, the IFS warned.
Employers must pay 10% of their furloughed workers’ usual wage from July 1, while the government will continue to pay the other 70%.
From August 1, the employers’ contribution rises to 20%, with the government’s contribution reducing further.
Abta wrote an open letter to chancellor Rishi Sunak and transport secretary Grant Shapps urging them to support the outbound travel sector by meeting the demands of last week’s Travel Day of Action.
The letter was sent as travel businesses face increased furlough costs and business rates payments from July 1 and as government reviews the requirements for international travel.
The travel association urged the ministers to provide tailored financial support to businesses and open up travel by adding more countries to the green list, and remove quarantine for those travelling to amber list countries who have been vaccinated before the end of July.
Transport Salaried Staffs’ Association general secretary Manuel Cortes said: “This is a terrible decision from those in power at Westminster to start phasing out furlough support while we remain in a pandemic. It will put workers at greater risk of being laid off – none more so than in our travel trade which has been hit so hard by the pandemic.
“Removing furlough support for our travel trade smacks of wilful ignorance because government knows perfectly well that the industry has really not been able to trade in any meaningful way now for over a year. This has led to intolerable pressure on jobs and businesses up and down our high streets.
“If ministers had any sense they would recognise that there are some sectors which have not had the chance to recover, because of the nature of their business. That is certainly the case with our travel trade.
“I’m calling today for an extension of the full furlough terms for travel so that we can save jobs and make sure we have a sector to come back to when the pandemic is over.
“Doing so will make sense for everyone, not least our members. There is still time to put this right and I call on ministers to do so without delay.”
Gemma Walker, an account manager for Newmarket Holidays, told the BBC she hasn’t seen clients or gone into the office for 15 months.
She can see the furlough scheme has been a lifeline for the business, but the experience has been hard for her.
“I felt an overwhelming sense of guilt about the colleagues at Newmarket who are still working,” Walker said. “They’ve really held the fort for the rest of our team.”
She used to travel around the country, talking to agents and attending conferences.
“When something like that is completely taken away from you, you almost feel lost,” she said. “My purpose is gone now because this is what I’ve worked towards my whole career, starting way back when I was 17 years old.
“I went through a stage of making sure I set an alarm every morning getting up.
“You have to get yourself in a mindset of, ‘I have to carry on, I have to do something,’ because I don’t know when I’m going to be going back.”
Newmarket Holidays chief financial officer Mark Vincent told the broadcaster: “We’ve tried to retain as many people as possible.
“The furlough scheme has been critical. It’s part of the difference between survival and not.”
But he said that realistically, travel firms, which have had two summers of interrupted business, might need to reconsider staffing levels.
“In those winter months, we’re all going to be loss-making and therefore, we’re going to have to relook at what we do with our staffing.”
More: PM postpones lockdown easing but ‘no plans’ to extend furlough
BA ‘furloughs thousands of staff’ amid continuing travel curbs