M&S’s 10% job cuts add to dire few weeks for retail sector

Marks and Spencer Group PLCs (LON:MKS) plans to cut around 10% of its workforce adds to masses of painful cuts in the sector in recent months.

The food and clothing chain added 7,000 jobs cuts to nearly 1,000 last month, equating to around one in ten of its total headcount, and around 12% of the cuts are thought to be facing its 60,000-strong shop-floor workers over the next three months.

This round of job losses takes the number of announced retail sector redundancies to around 24,000 for the past month and a half.

In July and August the retail sectors cuts include:

Before the cuts announced by M&S and Debenhams, total job losses announced by the retail sector were already topping 114,000 so far this year, according to data from the Centre for Retail Research (CRR) that goes up until mid-August.

Of this, 42,817 jobs have been lost to companies going into administration and 61,543 from restructuring, rationalisation, streamlining, rightsizing, or whatever new terms for job losses is being employed.

Some 13,664 stores have been closed, the CRR said, adding that “we do not yet know how many of these will actually re-open at all, in view of the fact many shoppers seem to be avoiding the high street at present”.

Back in March, the centre had forecast that 20,622 stores will close in 2020 versus 16,073 in 2019 and job losses will rise to 235,704 against 143,128 last year.

Some stores may reopen after pubs, cafes and restaurants re-open.

“It could take much longer before we know how many shops remain in business. Judging the impact of coronavirus finally on retailing may take a little more time, because it is not primarily about corporate announcements,” the research group said.

The coming of the coronavirus pandemic has accelerated and exacerbated previous trends, analysts and sector watchers say.

For M&S, most of the cuts are being aimed at its 60,000 shop floor workers, plus some in its support centre, regional management and head office too.

For the food and clothing chain this represents a huge step from the 950 job cuts that it thought would be enough only a month ago.

Management said there had been a material shift in trading since May when stores reopened after the coronavirus lockdown, plus a realisation “that we can work more flexibly and productively with more colleagues multi-tasking” and working across both the food and general retail sections, the retaiRead More – Source

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