BRC-Bond Pearce retail monitor Q4 2011: Food retailers drive up jobs growth

26 January 2012

In the fourth quarter of 2011, retail employment rose by 0.5% compared with the same quarter a year earlier, the equivalent of 4,074 more full-time jobs according to our sample. During the same period the number of retail outlets grew by 1.0%, an additional 528 shops.

The Monitor measured a net fall in the number of non-food stores in December compared with the same time last year. The overall increase in the equivalent number of full-time workers and stores was driven by food retailers.

The fall in full-time equivalent (FTE) non-food workers was driven by a loss of part-time jobs, which fell fastest.

Stephen Robertson, British Retail Consortium Director General, said: "After a disturbing fall in overall retail employment in September last year, it's a relief to see marginal improvement at the end of 2011. It's likely the delay taking on seasonal staff which hit the previous quarter boosted numbers in the last three months of the year. But there's little to celebrate while the underlying labour market conditions remain so fragile, as we've seen in a flurry of post-Christmas administrations. This survey is being compared with a weak end to 2010 when severe snowfall hit retail badly and reduced the hours staff would've been working.

"Following reductions in non-food staff numbers during 2011, we're now seeing stores close. Retailers are focused on reducing costs and reviewing property portfolios, which means employment prospects are weakening. After a raft of retail failures in the first few weeks of 2012 there is a danger more stores will be pushed over the edge. Retailers are facing a 5.6 per cent leap in business rates in April, despite inflation already falling well below this level. The Government can protect the jobs market by showing restraint setting the National Minimum Wage, and by acting more swiftly on employment reforms such as simplifying the tribunal process."

Christina Tolvas-Vincent, Head of Retail Employment at business law firm Bond Pearce, said: "Seasonal hiring provided a glimmer of hope for retail employment figures at the end of last year but sadly this won't last. We have already seen a number of retailers enter administration since Christmas and there is no sign of any knight in shining armour for the industry. Retailers are also aware that consumers are likely to be tightening their belts for the next few months and this is going to squeeze them and their profit margins even further."

"Even so, there are still those who remain fairly optimistic for 2012, despite the tough trading conditions. The disparity between food and non-food retailers remains and some supermarkets will continue to provide growth. However for many non-food retailers the focus is more on survival than growth and those who feel vulnerable already need to do everything they can to prevent outright failure. Redundancy figures are still relatively low but if more retailers fail this may change. It also seems unlikely that growth in retail, a major employer in the private sector, will compensate for public sector losses as some had hoped."

http://www.brc.org.uk/bis/default.asp?main_id=6&sub_id=13&show_id=7

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