UK retailers cut 150,000 jobs in 2018 amid falling profits: Study

Troubled UK retailers have been forced to cut around 150,000 jobs in 2018, as high taxes, slow growth and rising online sales continue to bite into their profits even in the year's busiest shopping period, a new study shows.

Data from the Centre for Retail Research (CRR) showed Monday that 148,132 were lost as around 20,000 shops and restaurants were closed this year, according to British media.
The outlook remained gloom for next year as well, as retailers were predicted to continue struggling with dwindling profits in anticipation of the country’s pending exit from the European Union (EU).

UK Prime Minister Theresa May’s draft Brexit deal has hit strong opposition in Parliament, drawing an even more uncertain future ahead of businesses only months away from the EU’s March 2019 deadline for a divorce.

"While parliament is obsessed with Brexit, business rates and low growth are killing the high street," said Professor Joshua Bamfield, the director of the CRR.

"We feel that 2019 is going to be a repeat of these dire figures unless or until the government takes action to provide a level playing field for both online retailers and the high street," he added.

Besides Brexit, British businesses are finding it difficult to keep up with fast-growing online sales.

This year, a number of major British retailers failed to respond to fierce online competition. One of the more notable victims of this was the British budget chain Poundworld, which collapsed earlier this year costing some 5,100 jobs.
Department store chain Debenhams was also forced to shutter one third of its shops round the UK. This is while its primary rival, House of Fraser, was sold to retailer Sports Direct to avoid a similar fate.

Online retailers not doing much better either

On Sunday, the insolvency firm Begbies Traynor released data that showed more than 30,000 retailers were going through “significant” financial distress during the year’s busiest shopping period.

Interestingly, the data showed even online businesses were not doing particularly well as nearly 8,500 of the 30,000 experiencing holiday shopping slumps were online retailers.
“As we near the end of the crucial festive period, with many retailers pinning their hopes on a final flurry of shopper activity this weekend as more are plunged into significant financial distress, to say 2018 has been a tumultuous year is something of an understatement,” said Julie Palmer, a partner at the insolvency firm.

“Even online, which has been hailed as the future of the sector, is not immune.”

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