One million retail jobs under threat in the UK due to ecommerce and rising business costs

By

Barbara Santamaria

Published
Jan 31, 2017

One million retail jobs could disappear in the UK if the Government fails to take action, warned a new report from think tank Fabian Society.

The British retail industry is struggling to cope with drastic changes in the shopping habits and rising business costs, and despite employing more workers than any other industry it remains largely absent from every major government speech on industrial strategy.

Fabian Society established a taskforce to analyse the current situation over a 12-month period, which found that companies are reducing costs by paying staff as little as legally possible and outsourcing areas of their business to adapt to the changes.

“Retail is at the crossroads. Online retailers threaten to destroy high streets and pound shops are sprouting up in the space that’s been left behind. As a result, the retail sector is threatened with one million job losses or a continued rise of precarious low-skill, low-pay employment practices,” said Norman Pickavance, chair of the taskforce.

"Our analysis highlights that failure to include the retail sector in the modern industrial strategy is a glaring omission. There is an alternative path for retail where focused investment and policy changes can stimulate innovation, create better jobs and help to renew the vitality and fabric of urban and rural communities," he added.

Government policies have been criticised by a number of industry institutions, organisations and companies including the British Retail Consortium and Tesco.

Retailers are likely to have a difficult 2017, with the new National Living Wage rising to £7.20 an hour for those aged 25 and over in April. The continued growth of online shopping and the introduction of new business rates are also expected to hit Central London and South East retailers.

Additionally, the Government’s new apprenticeship levy could also lead to increases in job losses, have warned industry analysts.

The number of full-time retail jobs already declined by 3% in the fourth quarter of last year, according to data from the British Retail Consortium.