Retail job cuts have hit their highest rate since records began nearly a decade ago thanks in part to automation and wage increases.
According to the British Retail Consortium (BRC) retailers employed three per cent less staff year-on-year in the last quarter, while the average number of hours worked dropped 4.2 per cent, both measures representing the sharpest decline since the height of the last financial crisis in 2008.
Retail’s employment figures are made all the more significant when compared with the wider economy, which has seen unemployment fall to the lowest point in 40 years.
Just yesterday fast fashion retailer New Look announced nearly 400 job cuts, and last week Sainsbury’s revealed plans to cut thousands. Retailers across the country are undertaking sweeping restructures of their operations in attempts to avoid passing rising costs onto customers.
A continual rise in minimum wage, pension schemes and training levies, alongside rising business rates and import costs have all contributed to the financial pressure which is affecting jobs in the retail sector, which represents around 10 per cent of the country.
“The pace of job reductions in the retail industry is gathering steam,” BRC chief executive Helen Dickinson said.
“Behind this shrinking of the workforce is both a technological revolution in retail, which is reducing demand for labour, and government policy, which is driving up the cost of employment.
“The challenge for retailers will be in maintaining the pace of productivity improvement as they come up against shortages of the skills needed for a new, digital-dependent industry.”