Women first in fir­ing line as 7,000 jobs fall to cri­sis

Cuts at John Lewis, Boots and Burger King ex­pected to un­duly hit women, who fill 58pc of re­tail po­si­tions

The Daily Telegraph - Business - - Front Page - By Chris John­ston

THE cri­sis en­gulf­ing Bri­tain’s bat­tered high street deep­ened last night as John Lewis, Boots and Burger King an­nounced al­most 7,000 job losses and a raft of shop clo­sures.

The cuts are ex­pected to dis­pro­por­tion­ately hit women, who fill 58pc of re­tail po­si­tions.

John Lewis said that eight of its sites will re­main shut for good – in­clud­ing a flag­ship 250,000 sq ft depart­ment store in Birm­ing­ham – with 1,300 of its staff ’s jobs at risk along with many more work­ing in con­ces­sions.

An­other 4,000 jobs are un­der threat at Boots, which is shut­ting al­most 50 of its op­ti­cian out­lets across the coun­try, while 50 Burger King restau­rants may not re­turn from lock­down.

Ex­perts also warned that the cuts could trig­ger a tsunami of fur­ther clo­sures as an­chor sites are aban­doned, hol­low­ing out town cen­tres that were al­ready strug­gling.

Sam Smethers, chief ex­ec­u­tive of the Fawcett So­ci­ety, said women were more likely to have been fur­loughed and hit hard­est by job losses.

She said: “Now we see those job losses es­ca­lat­ing. Com­bined with the im­pact of a loom­ing cri­sis in the child­care sec­tor and signs of ris­ing preg­nancy dis­crim­i­na­tion, women are un­doubt­edly bear­ing the eco­nomic brunt of this cri­sis.”

The clo­sure of John Lewis’s Grand Cen­tral stores is a huge blow to Birm­ing­ham. It only opened five years ago as part of a £600m re­de­vel­op­ment of New Street Sta­tion.

Andy Street, Con­ser­va­tive mayor of the West Mid­lands and a for­mer boss at

John Lewis, said: “The pro­posed clo­sure of Birm­ing­ham’s John Lewis store risks be­ing a dread­ful mis­take.”

John Lewis is also shut­ting stores in Wat­ford, Heathrow air­port and St Pan­cras sta­tion, as well as four At Home out­lets in Croy­don, Newbury, Swin­don and Tam­worth. Dame Sharon White, its chair­man, said the sites be­ing closed were strug­gling be­fore lock­down and had to shut to pro­tect the busi­ness.

Boots’ lay-offs will af­fect about 7pc of its work­force.

Re­tail con­sul­tant Richard Hy­man said the depart­ment store and chemist chains are likely to launch fur­ther cut­backs in com­ing months and he was sur­prised tmore clo­sures had not been an­nounced. He said: “The can has been kicked down the road but … we are near­ing the end of the road and painful is­sues are go­ing to have to be ad­dressed.”

The high street was al­ready on its knees be­fore lock­down as on­line ri­vals such as Ama­zon at­tracted ever greater num­bers of cus­tomers. This shift has since been turbo-charged, leav­ing far too many bricks and mor­tar stores to han­dle dwin­dling shop­per num­bers.

At least 40 re­tail­ers have col­lapsed this year, af­fect­ing more than 2,600 stores and close to 60,000 work­ers, the Cen­tre for Re­tail Re­search said.

He­len Dick­in­son, chief ex­ec­u­tive of the Bri­tish Re­tail Con­sor­tium, said coro­n­avirus had ac­cel­er­ated many of the trends that were al­ready un­der way.

She said: “The pan­demic has posed a huge chal­lenge for the vi­a­bil­ity of many shops, threat­en­ing their sur­vival fol­low­ing months of greatly re­duced turnover as a re­sult of store clo­sures.

“While the re­open­ing of shops and other ser­vices is vi­tal to recovery, foot­fall and in-store sales re­main be­low nor­mal level. Fur­ther­more, months of rent has built up on shops forced to close and now rep­re­sents a time bomb.”

Clare Bai­ley, of the Re­tail Cham­pion con­sul­tancy, sounded a note of op­ti­mism, sug­gest­ing that some con­sumers will con­tinue to favour in­de­pen­dent re­tail­ers at the ex­pense of chains be­cause of their su­pe­rior lev­els of ser­vice.

‘Ex­cep­tional”, says Rolls-Royce boss War­ren East when de­scrib­ing the cur­rent mo­ment. If only the same could be said of Bri­tain’s most il­lus­tri­ous en­gi­neer­ing com­pany. It is bleed­ing cash – £3bn of it in the first six months to be pre­cise, as or­ders evap­o­rate and de­mand to ser­vice planes dis­ap­pears too – a rev­e­la­tion that wiped 11pc off its share price in one fell swoop.

Still, even that beats East’s last pub­lic out­ing – a “ner­vous” smirk on TV as 9,000 em­ploy­ees were about to be handed their P45s but at least he’s try­ing to make up for the gaff with a prom­ise to treat all em­ploy­ees with “dig­nity and re­spect”.

East is right of course. Bri­tish Air­ways, easyJet, Vir­gin At­lantic and the other ma­jor air­lines are the ob­vi­ous ca­su­al­ties of what he calls “a his­toric shock in civil avi­a­tion”, yet Rolls-Royce has been caught in the eye of the storm too.

And East thinks it will “take sev­eral years to re­cover”, maybe as long as seven years, the most pes­simistic fore­cast of any top in­dus­try fig­ure yet.

What can Rolls do about it? Not much. Half its £16bn an­nual turnover comes from civil aerospace and with its two big­gest cus­tomers, Air­bus and Boe­ing, slash­ing pro­duc­tion by as much as 40pc, it has lit­tle choice but to take the axe to costs too.

And don’t count on our boy won­der Chan­cel­lor to ride to the res­cue. Yet while Rishi Su­nak is pos­ing as a hum­ble Waga­mama waiter and com­ing up with catchy taglines about eat­ing out, vi­tal en­gi­neer­ing skills are in dan­ger of be­ing lost in places like Derby, where Rolls is based and the brunt of its lat­est job cuts will be felt.

So far, apart from a bespoke bailout for the UK arm of Span­ish steel maker Celsa, the Chan­cel­lor seems to have lit­tle time for man­u­fac­tur­ing; but if the Trea­sury has time to come up with a voucher scheme to en­cour­age us to dine out again, even though it’s still not com­pletely safe to do so, then surely it can think more long-term about the man­u­fac­tur­ing sec­tor.

Never mind “Build, Build, Build” or “Build Back Bet­ter” or any of the other clever slo­gans this Govern­ment seems ob­sessed with, noth­ing will be get­ting built if the fac­to­ries have closed down.

Be­sides, here’s a far bet­ter catch­phrase: “Build Bri­tain out of this dread­ful sit­u­a­tion”, though it’s one that is un­likely to catch on at Num­ber 10, not least be­cause it is the work of trade union Unite and it in­volves the cre­ation of a Na­tional Coun­cil of Recovery, some­thing that sounds like a relic from the Soviet Union.

But by stim­u­lat­ing de­mand, the harm to man­u­fac­tur­ing can be con­tained. There’s much the Govern­ment can do in terms of plac­ing or­ders – where will the steel for HS2, if it ever goes ahead, come from for ex­am­ple?

But it should start with nu­clear where en­list­ing the ex­per­tise of Rolls-Royce in build­ing so-called mini-nukes would help to solve its cur­rent geo-po­lit­i­cal night­mare with China.

It would make it eas­ier to ditch China Gen­eral Nu­clear Power Group from the plans to build gi­ant new plants at Sizewell on the Suf­folk coast and Brad­well in Es­sex, or scrap the pro­pos­als al­to­gether.

It would also of­fer a greener and cheaper al­ter­na­tive to a tech­nol­ogy that looks de­cid­edly out of date al­ready, and it would cre­ate jobs at a com­pany in des­per­ate need of a leg up – three birds with one stone. It’s time for the Chan­cel­lor to swap his bar apron for a hard hat.

‘Start by en­list­ing the ex­per­tise of Rolls-Royce in build­ing so-called mini-nukes’

Time to go to work cre­at­ing new jobs

So much for “jobs, jobs, jobs” any­way. Af­ter the mini-Bud­get, an­other mini-wave of re­dun­dan­cies. Hype ver­sus re­al­ity in the space of just 24 hours and Su­nak’s job pro­tec­tion scheme is al­ready in tat­ters.

Four thou­sand job losses at Boots un­der the guise of its “trans­for­ma­tion plan”, 1,600 at Burger King as it pre­pares to close one in 10 restau­rants, and 1,300 at John Lewis af­ter the de­ci­sion was taken to shut eight depart­ment stores, capped an ut­terly dis­mal day for the high street.

Su­nak be­lieves a scheme award­ing £1,000 to em­ploy­ers for ev­ery fur­loughed worker will make a “sig­nif­i­cant dif­fer­ence”. It’s cer­tainly orig­i­nal but yes­ter­day’s blood­bath sug­gests it isn’t nearly enough to stem the tide.

Many com­pa­nies are wak­ing up to the re­al­ity that busi­ness hasn’t re­bounded to any­thing like the lev­els ex­pected but their cost base, the bulk of which is labour in sec­tors like re­tail, re­mains the same.

All the stim­u­lus in the world can’t solve that equa­tion, nor can it halt the ac­cel­er­a­tion of struc­tural changes like the shift to on­line.

John Lewis says as much as 70pc of its sales will be on­line this year and next, com­pared with 40pc be­fore the pan­demic, turn­ing cav­ernous spa­ces like its flag­ship store in Birm­ing­ham city cen­tre into an un­sus­tain­able over­head.

The Govern­ment is ob­sess­ing about the preser­va­tion of jobs that in many cases are no longer needed. More time needs to be spent cre­at­ing them.

For­mer Bar­clays in­vest­ment bank­ing chief Roger Jenk­ins re­ferred to fi­nancier Amanda Stave­ley as ‘the tart’, the High Court heard

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