High Streets Initiative · 2 July 2018

Government urged to save high street with 50,000 jobs lost in 2018 alone

2018 has seen a host of high street mainstays enter administration

Ailing high street retailers have been forced to let go almost 50,000 employees in 2018 alone, new research has revealed.

According to data compiled by the Press Association, almost 50,000 high street workers, from well-known chains such as Maplin and Toys R Us to smaller businesses struggling to stay afloat, have been made redundant or had their role put under threat.

In June 2018 alone, the announced closure of dozens of House of Fraser branches saw 6,000 jobs put at risk, while Poundworld’s administration threatened 5,100 jobs.

Read more about the high street’s struggles:

In response to the findings, trade union organisation the TUC urged the government to “up its game” and keep the high street trading.

Frances O’Grady, general secretary of the TUC, said low consumer spending power had contributed to the loss of high street prosperity.

“Retail depends on customers having money in their pockets. One reason why some shops are struggling is because wage growth has been very weak,” she said.

“Government needs to up its game, boost the economy and invest in great jobs that people can live on.”

High street jobs lost or at risk

  • House of Fraser: 6,000
  • Poundworld: 5,100
  • M&S: 870
  • New Look: 980
  • Carpetright: 300
  • Mothercare: 800
  • Homebase: 2,000
  • Jamie’s Italian: 200 jobs

Spiraling business rates have also been attributed to high street struggles. Following last year’s revaluation, the average business rates bill for a department store in England and Wales increased by 26.6% to £717,952, according to ratings agency Altus Group.

“Business rates are rarely the sole driver for insolvencies but certainly a contributory factor, with bills having risen by more than a fifth through inflation during the seven years before last year’s revaluation,” said Robert Hayton, head of UK business rates at Altus.

“Add that to the lethal cocktail of other increased operating costs for the national living wage and apprenticeship levy and it creates the perfect storm for 2018 being the year of the CVA (company voluntary agreement).”

A return to the 1970s?

While restaurant and retail businesses struggle, other sectors are looking to strengthen their high street presence.

Challenger energy supplier, Utilita, has announced the opening of its first bricks and mortar store in an effort to bring utility shops back to the high street.

The new store, opening in Gosport later this month, will provide the opportunity for customers to get energy efficiency advice, top-up their energy meters and speak directly with Utilita staff. There will also be an interactive area for children to learn about energy.

Steve Parker, director of retail at Utilita, said: “While a number of firms, including famous household brands, are closing shops, we believe there is still huge potential on Britain’s High Street.

“Our research suggests many customers want to be able to interact with us directly rather than rely solely on the phone, email or on social media – the shop provides that option.

Parker also revealed there are plans to offer other products and services in the store in the future.

He added: “In many ways, this is a throwback to the ‘70s and 80s when the regional utility board shops where a familiar site on the high street and anyone could pop in. Those days were seemingly over but we want to bring energy back to the high street – in every sense.”

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ABOUT THE EXPERT

Simon Caldwell is deputy editor at Business Advice. He has a BA in politics and communications from the University of Liverpool, and has previously worked as a content editor in local government and the ecommerce industry.

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