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Digital shopping endangers retail employment

A shift towards online shopping and digital retail technologies has led to a decrease in investment in retail employment

Changes in the retail sector, such as an increase in digital adopting and online sales, have led to a drop in yearly retail employment, according to the British Retail Consortium (BRC).

The BRC found that employment in the retail sector fell by 2.4% in the first quarter of 2019 compared with the same period in 2018.

It says this drop is as a result of “structural change in the retail industry triggered by the advent of online sales and other technologies”.

Helen Dickinson, chief executive of the BRC, said the yearly drop in the number of retail employees is the equivalent of axing 74,400 people from the sector.

“Retail is undergoing a period of unprecedented change in response to new technologies and changing consumer behaviour,” she said. “The investment required to successfully navigate this transformation is being held back by the rising cost of public policy.”

Employment in the retail sector has been falling steadily over the past year, according to figures from the Office for National Statistics, dropping by 2.1% in the fourth quarter of 2018, and by 2.9% in the third quarter of 2018, despite employment in the UK overall being on the rise.

Overall, the number of stores in the UK increased, and the BRC reported a 2.3% store growth in the first three months of 2019.

But these stores were smaller format, a trend that has been on the rise because of technology-driven consumer behaviour forcing retailers to cater to convenience shopping.

Dickinson added: “While the number of stores rose, this was mainly driven by an increase in small-format stores, with many larger stores closing – resulting in a net job loss. More jobs are likely to disappear unless there is a shift in government policies.”

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Retail jobs have been declining for the last few years, with many people pointing the finger at technology adoption for falling employee numbers, while others blame shifting consumer behaviour in the wake of digital shopping.

And the pattern doesn’t look likely to change – almost 20% of retailers questioned by the BRC said they plan to reduce their workforce over the next three months.

Dickinson said some of the three million people relying on jobs across the retail sector are still in danger of losing their roles in the near future because of rising business costs.

But there have been suggestions from experts about how to solve this problem. In 2015, the UK Commission for Employment and Skills said retailers should be investing in giving employees new skills to keep up with the pace of change in the sector.

Some retailers have adapted their training programmes to reflect the shifting retail landscape, and technology adoption in the sector may be threatening some jobs, but it also has the potential to create new roles.

Read more on IT for retail and logistics

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