Shop numbers in the UK drop for the first time in three years

Shop numbers in the UK have dropped for the first time in at least three years, according to new figures.
The number of retail outlets fell by 0.5 per cent in the second quarter of 2012 compared with the same period last year, the first fall since the British Retail Consortium-Bond Pearce Retail Employment Monitor (REM) began in October 2008.

The BRC said the decrease marked a significant shift from consistent annual growth in store numbers since the data began, with the underlying trend showing a weakness in store openings over the last 12 months.

The fall in the number of stores is “indicative of the challenges facing high streets” with vacancy rates at historically high levels, it said.

However, retail employment, or total hours worked, in the second quarter of 2012 rose by 1.8 per cent compared with the same quarter in 2011, the equivalent of 12,648 more full-time jobs, according to the BRC’s sample.

The increase was driven entirely by food retailers, with the fastest growth from part-time workers. The total number of hours worked in non-food retailing fell.

The proportion of retailers suggesting that they will decrease staffing levels over the next quarter has fallen to just four per cent compared with 25 per cent for the same period last year.

BRC director general Stephen Robertson said: “Retail as a whole is still where much-needed new jobs are coming from but, within that, it’s food retailing that’s providing more work.

“Big events like the Jubilee celebrations provided a limited boost to employment levels but underlying weakness in the economy and consumer confidence continue to hit sales and job numbers in non-food retailing.

“Overall retail sales growth across the first half of 2012 was no better than a year earlier and the first decline in store numbers among retailers in the survey since it started in October 2008 shows the worst-hit shops being shut as customers hold back spending. Supermarkets, continuing to open smaller-format stores, are masking the potential of a much sharper decline. Without them, total shop numbers would have fallen further.

“Even so, retailers’ sentiment about the coming quarter has improved. A year ago a quarter said they would be cutting jobs. Now that’s only four per cent. And, the relaxation of Sunday trading laws during the Olympics is expected to provide a boost to the number of hours worked over the coming months.”

Christina Tolvas-Vincent, head of retail employment at business law firm Bond Pearce, said: “At first glance there are some positive messages here; rising employment which translates to more than 12,000 extra full-time equivalent jobs and redundancy rates remaining very low.

“Serious concerns remain, however. The number of retail outlets is falling for the first time reflecting the immense pressure on high street retailers in particular, and for non-food retailers employment levels are down.

“It is therefore encouraging to see the government looking at creative ways to bring vacant high street properties back into use and also offering further help to pilot areas under the Portas project.

“Employment intentions have dramatically improved. With 83% planning to keep staffing levels unchanged compared with just 58 per cent last year it looks like retailers are hoping for some light at the end of the tunnel.”

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