This week Boots and John Lewis became the latest major UK high street chains to announce job losses. Boots says it plans to cut around 4,000 jobs, 7% of its total workforce. This comes on the back of news that John Lewis will close eight of its 50 UK stores, resulting in approximately 1,300 job losses. Both companies insist these redundancy measures were part of pre-existing restructuring. However, they admit these plans have been brought forward following significant drops in sales due to the coronavirus lockdown. Boots has reported a 78% drop in sales at its stores, despite remaining open during the pandemic. These latest job losses follow the loss of nearly 9,000 high street jobs announced last week.
The end of high street shopping?
As an increasing number of major high street chains announce jobs losses, some are claiming UK high streets may never recover. Boots revealed online sales increased 78% during the coronavirus lockdown. Meanwhile, online sales at John Lewis rose from 40% of total sale before the shutdown to over 70% now. Other high street stores are reporting similar redundancy fears. These include Arcadia Group (owners of Topshop) and Burger King, which announced up to 10% of its UK outlets could close, resulting in 1,600 high street job losses. Poundstretcher has also revealed half of its stores could be forced to close if landlords do not reduce rent.
High street chains to announce further job losses?
Vivienne King, chief executive of Revo which represents the retail property sector has warned of much bigger redundancy problems on the horizon. Speaking to the BBC, Ms. King said three million retail jobs are at risk because of the coronavirus lockdown unless the government reviews business rates and provides rent support. This warning was reinforced by Len McCluskey, general secretary of the Unite union. Mr. McCluskey stated, “Our fear is the summer jobs tsunami we have been pleading with the government to avoid will now surely only gather pace.”
Government Measures – Too little too late?
Chancellor of the Exchequer Rishi Sunak unveiled a series of new post lockdown measures this week aimed at saving high street jobs and kick starting the UK economy. The measures include single payments of £1,000 to employers for every furloughed employee they retain until February 2021. Furthermore, a 50% reduction (up to £10) has been promised for diners eating out midweek during August. This measure is a direct attempt to help the food & drinks industry and increase high street footfall. However, unions and analysts have warned these incentives are not enough to stop potentially millions of more job losses. It seems the chancellor accepts this, admitting the government would not be able to protect “every single job”. Speaking to the BBC, Mr. Sunak, said:
“We are entering one of the most severe recessions this country has ever seen. That is of course going to have a significant impact on unemployment and on job losses.”
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