One in ten retail jobs at risk in the next three years
Cost pressures in UK retail mean one in ten jobs are at risk of disappearing by 2028, according to a new report.
The number of jobs in retail has already dropped by over 350,000 since 2015, a fall nearly ten times bigger than the total number of jobs in the steel industry, the British Retail Consortium has found.
While the government has made “repeated interventions [in steel] to prevent factory closures and save British jobs,” retail has been hobbled by ever-mounting costs and red tape, the BRC said.
Changes to Employer’s National Insurance are costing the industry £2.4bn, while increases to the National Living Wage in April added a further £2.7bn to wage bills.
Since April, the cost of employing an entry level full-time worker rose by 10.3 per cent, while the cost of employing someone part-time rose by 13.5 per cent, according to the BRC.
“While factory closures are met by promises of action, the wave of retail jobs losses has been met with indifference from policymakers,” BRC boss Helen Dickinson said.
“UK retail is world-leading, innovative, and a major contributor to the UK economy, yet the stranglehold of increasing costs, taxes and red tape risks undermining the very things Government is seeking to create: local investment, growth, and increasing the numbers of people in work,” she added.
The number of retail job vacancies has fallen by 39 per cent year on year, according to Adzuna’s latest jobs report.
Concern over workers rights overhaul
Businesses have warned that proposed policies like the Employment Rights Bill, which are aimed at solving the problem, won’t help.
Just over 60 per cent of retail HR directors believe will reduce flexibility in job offerings, while over half think it would reduce staff numbers for their company.
Another survey has found that seven in ten bosses believe the government’s workers right overhaul will harm growth, with over half of those expecting the bill to have a “strong negative impact” on the economy.
Businesses have been particularly vexed about changes to statutory sick pay (SSP) as well as “day one rights” for new staff.
“Many retailers fear these changes will introduce significant additional costs for their business, which will ultimately lead to price rises for consumers and/or to headcount reductions,” James Major, Partner at global law firm Clyde & Co, said.
Major also pointed to proposals to give those on zero or low hours contracts the right to guaranteed hours, the potential for additional costs associated with unfair dismissal rights from ‘day one’ of employment and the proposed changes to collective redundancy obligations as headaches for retail.
Dickinson said that if the government is able to “tackle unscrupulous employers without hampering employment opportunities offered by responsible businesses” they will “reap the benefits through more jobs and better productivity.”
“But if they don’t, they will end up “punish[ing] millions of people who benefit from these flexible, local jobs,” she said.