Many more job losses and closures 'likely', retailers warned

Retail Excellence managing director Duncan Graham said 100,000 of Ireland's retail jobs could go. 

Marks and Spencer is the latest high street retailer to cut jobs, but considerably more closures and cuts are expected

Irish retailers are likely to be hit by significantly more job losses and store closures in the coming months, the industry’s two main representative groups have warned.

Retail Excellence managing director Duncan Graham said a worst-case scenario could see 100,000 of Ireland’s approximately 300,000 retail jobs go if trading conditions continue to deteriorate.

The bleak outlook follows British department store giant Marks and Spencer announcing a further 7,000 job cuts across its group.

M&S said the cuts will cover its headquarters, UK stores and regional management over the next three months and the move follows 950 of its store management jobs being cut last month.

It is not known whether any of its jobs in the North will be affected, but none of M&S’ 18 stores in the Republic will be hit.

A steadily rising number of retailers across the UK and Ireland are shedding jobs — Debenhams, Dixons-Carphone, and Brown Thomas-Arnotts among them within the last month.

Mr Graham said significant further job cuts are likely but hopefully numbering below the worst-case scenario 100,000 estimate. He said an improvement in retail sales in July, due to pent-up consumer demand, has levelled off.

The Ibec-affiliated Retail Ireland echoed the grim prediction of more job losses. It said city and town centre high street retailers are the most exposed to further shocks, where footfall remains low and even restricted shopper number allowances cannot rely on office workers or foreign tourists.

Retail Ireland director Arnold Dillon said some parts of the industry have rebounded relatively well since emerging from lockdown, but “significant” parts remain under “extreme stress”.

City centre shops are “suffering enormously”, he said and many smaller retailers nationwide cannot compete with international online retailers as shopping habits change.

Mr Dillon said the pre-Covid cost bases of many retailers is “out of line” with the current reality and many companies are having to make significant decisions — including headcount reductions — in order to make their business models sustainable.

He said retailers will benefit from much of what was included in last month’s stimulus package — including the Vat reduction, wage subsidy scheme extension, and commercial rates waiver — but said not every retailer will be able to pass on the Vat benefits and rent costs remain a huge issue.

Mr Dillon said a key part of retail’s recovery will be getting office workers back to work safely, adding that this year’s Christmas trading period will be hugely important.

“Whether we can get the economy and retail back to full steam by then will be a determining factor in whether many small independent retailers will survive,” he said.

Meanwhile, latest figures show that grocery sales in Britain rose by 7%, year-on-year, in the four weeks up to August 8. The figures from market research group Nielsen show a slowing down from the previous four-week period, partly due to consumers adapting to new Covid-19- driven buying routines.