Business groups have described their collective relief after the job retention scheme was extended until the end of October.
Chancellor Rishi Sunak confirmed the Government will continue to pay the wages of workers on leave because of coronavirus.
Employees who are furloughed by their employers will continue to receive 80% of their monthly wages up to £2,500 until 31 October 2020.
The Treasury said 7.5 million workers - around a quarter of the UK's total workforce of 33 million people - are currently covered by the scheme.
From August, the scheme will continue to operate for all employers in the UK, with furloughed workers able to return to work part-time.
There had been fears of an imminent scaling back or cessation of the scheme based on press reports.
The Confederation of British Industry said the extension "avoids a June cliff-edge and will protect millions of jobs".
Mike Cherry, chairman at the Federation of Small Businesses, said:
"This is a lifeline which has been hugely beneficial in helping small employers keep their staff in work, and it's extension is welcome.
"Small employers have told us that part-time furloughing will help them recover from this crisis and that new flexibility is welcome."
Adam Marshall, director-general at the British Chambers of Commerce, added:
"The extension of the job retention scheme will come as a huge help and a huge relief for businesses across the UK.
"The changes will help businesses bring their people back to work through the introduction of a part-time furlough scheme."
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