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UK retail jobs reach a seasonal low

Dec 30, 2024 United Kingdom

The UK's retail sector navigates declining employment levels and rising labour costs, with new government policies in 2025 expected to add financial strain and push further automation investment

The latest figures from the Office for National Statistics show that retail jobs in the United Kingdom (UK) totalled 2.81 million in September 2024, a seasonal low before the Christmas hiring surge.

The four-quarter average reflects a decline of 40,000 jobs compared to 2023 and a substantial decrease of 225,000 jobs compared to five years ago. Helen Dickinson, Chief Executive Officer at the British Retail Consortium (BRC), noted that despite the fall, retail remains the UK's largest private sector employer, with an additional 2.7 million roles in the supply chain.

The decline in retail jobs is influenced by structural changes, including increased automation, outsourcing of warehousing and logistics and a focus on improving productivity, according to the BRC.

Increased hiring costs have also played a significant role, with industry pay growing by 8.5% in 2024, above the national sectorial average. Further pressures are anticipated in 2025 due to the Budget's National Living Wage increase of 6.7% and changes to employer National Insurance contributions, which are expected to add over 5 billion British pounds (6.05 billion euros) to retailers' wage bills.

Cost pressures, combined with weak consumer spending intentions, are expected to create a challenging environment for the retail industry. The BRC noted that retailers are likely to respond by further investing in automation and continuing to focus on productivity.

However, such responses could accelerate reductions in part-time positions and potentially lead to store closures and recruitment freezes, disproportionately affecting communities reliant on local retail jobs.

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