Claim 11,000 jobs at risk due to North shopping

AROUND 11,000 jobs could be axed because of cross-border spending sprees, business chiefs have claimed.

Retail Ireland said every 150 shopping trips to the North resulted in one more person on the dole queue here.

Figures from the Central Statistics Office (CSO) revealed southern customers spent €435 million in the North, so far this year.

Shoppers forked out an average of €286 on their most recent trips, with the vast majority stocking up on groceries and almost half of them buying alcohol.

Nearly one in six families here had, until July, embarked on a cross-border shopping trip.

The first CSO report on cross-border shopping trends confirmed the massive loses being accrued by southern retailers.

Cash-strapped consumers possibly made savings of up to 25% on an average family shopping list.

The CSO estimated that shoppers from the Republic spent about €435 million in the North during the first seven months of this year.

Reacting to the findings, Retail Ireland director Torlach Denihan said the continued haemorrhaging of custom to the North threatened thousands of southern jobs.

“We estimate every 150 cross-border shopping trips result in the loss of one job here,” he said. “Cross-border shopping during 2009 will cause 11000 people to lose their jobs. The retail staff that will lose their jobs during 2009 earn over €400m.

“The total cost to the state in income tax lost and social welfare payments for the 2009 job losses will be €220m.”

Demanding immediate Government action, Mr Denihan added there should not be any further increases in taxation on consumers in the upcoming budget and that the VAT rate should be reduced to 18% to stimulate retail sales.

The employers representative also used the launch of the report to demand abolishing of Retail Joint Labour Committees, which protect workers’ wages and conditions.

The CSO found those most likely to travel to the North to shop lived in border counties; were two-income households; people aged between 30 and 44 and families with children.

Households disclosed the average amount spent on their most recent trip was €286, of which €114 went on groceries and €32 on alcohol. Those that travelled further to shop appear to spend more, with households based in the mid-west, south-east and south-west regions having a combined average spend of €492 on shopping on their most recent trips. The figure compared to just €150 for border households.

Meanwhile, 80% of consumers purchased groceries in the North with alcohol the next most popular buy, at 44% while 42% bought clothing.

Chairman of the Irish Brewers Association (IBA), David Forde said in the build-up to Christmas the cross-border shopping was “reaching a crescendo”.

He accepted there were major savings to be made in the North.

“When such prices are available it is entirely understandable that data reveals southern consumers are opting to buy significantly more beer when they travel North than they would on routine trips to their local supermarket or off-licence.”

He added: “The best means of addressing the price difference and to begin to repatriate some of the revenue that we are losing to Northern Ireland is to reduce our high excise rates. Ireland has the second highest beer tax in Europe.”


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