What Is Really Affecting Retail Job Numbers?

This blog is by Liz Parry, Strategic Account Director at Teleperformance UK.

The British Retail Consortium (BRC) has published new research last week estimating that the retail sector in the UK might lose up to 900,000 jobs by 2025 if current government plans are followed. In particular, the BRC is warning about a rise in minimum wage rates to support a National Living wage and the imposition of an apprenticeship levy.

At present, retail employs three million people in the UK so to lose almost a million jobs in a decade would be an enormous change. However, I personally believe that there is a much more complex picture emerging and to suggest that minimum wage increase will create so many job losses is very simplistic.

I believe that there are two much more important reasons why we are seeing a change in retail and the number of jobs available.

  1. Competition over tax. Big international retailers can spread their tax liability across many countries, they are multinationals. This helps them to pay tax in countries that offer lower rates of corporation tax when compared to the UK – such as Ireland. They are not breaking any laws and they can maximize the efficiency of their tax arrangements by ensuring that even if they do business in the UK, most of the profit is booked in a more advantageous location… local retailers cannot do this so there is a new kind of competition in the market today.
  2. Omnichannel expectations. Customers expect a much tighter integration between the online and offline offer of a retailer today. If this means that technology starts shaping the instore experience then it is highly likely that staff numbers will decline. It’s easy to imagine a fashion store that allows you to walk in, scan an item on your phone, pay on your phone, then walk out with almost no staff interaction… the staff will be there to advise rather than wait at tills.

It’s highly likely that these are the real areas that will affect retail job growth in future, not an increase in the minimum wage, but what do you think? Leave a comment here or get in touch via my LinkedIn.
Shopping Cart//embedr.flickr.com/assets/client-code.js

Photo by Rick Harris licensed under Creative Commons.

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