The number of workers on furlough has fallen to 4.2m, government data published on Thursday showed.
There were 4m people on furlough in December, which rose to 4.9m in January as the third national lockdown came into effect. But the figure has been falling since then, with 4.7m on furlough at the end of February and 4.2m as at 31 March.
A total of 39% of employers had staff on furlough at the end of March, compared to 41% a month earlier.
The Coronavirus Job Retention Scheme was introduced by the chancellor Rishi Sunak in March 2020, to prevent Covid-affected businesses having to lay off staff. A total of 11.5m workers had made use of the scheme, but numbers are easing as the vaccine rollout continues and lockdown measures ease.
Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: “Half a million people came off furlough in March as business owners prepared to throw open the doors of shops, beauty salons, gyms, restaurant patios and beer gardens across the country.
“We are likely to see the numbers fall back again in April, as business prepare for the rules to relax further in mid-May and again in June.”
However, she added: “It’s not unalloyed good news. While many of those coming off the scheme are returning to work, others will have been taken off the scheme and made redundant. We don’t yet have redundancy figures for March, but early payroll data shows 56,000 fewer employees than in February.”
Women still outnumber men on furlough, with 2.12m females and 1.95m males making use of the scheme. It also disproportionately affects both the young and old, with the under-18 age band having the highest take up rates. HM Revenue & Customs noted: “Employees aged 18-to-24 and 65 and over were also more likely than average to be on furlough.”
The ten industry groups with the highest take up rates currently include passenger air transport, hospitality and tour operators.
The scheme is due to end in September.