More than 40% of retail stores are planning to reduce their workforce, in addition to the 250,000 jobs lost on the high street in the past five years, according to industry research. A survey conducted by the British Retail Consortium revealed that store managers anticipate cutting staff, reducing working hours, and pausing new hires due to increasing employment expenses. These concerns are partly attributed to the recent raise in national insurance costs for employers, which came into effect last year.
The study, which involved chief financial officers and finance directors in the retail sector, found that 69% of respondents felt pessimistic about the future, up from 56% a year ago. Only 14% expressed optimism. Labor and employment costs emerged as the top concern for 84% of participants, a significant increase from 21% in the previous survey.
As a result, many retail businesses are planning to decrease the number of hours offered to employees, freeze recruitment, and potentially cut head office and store staff. The British Retail Consortium highlighted the impact on the industry, which has already lost 74,000 jobs in the last year and over 250,000 in the past five years. The organization emphasized the importance of how the Employment Rights Act is enforced to mitigate further job losses.
The looming threat of additional job cuts in the retail sector follows the recent collapses of prominent chains like Russell & Bromley and Quiz. Helen Dickinson, the BRC chief executive, expressed concerns about the fragile economy, citing weak wage growth, rising unemployment, and diminished consumer confidence. She stressed the need for government policies to support job creation and address escalating business costs to prevent further job losses in an already struggling industry.
