Retail workers are more likely to be made redundant and face a longer duration of unemployment compared with employees in other sectors, a new report has found.
The report – ‘Sorry, we’re closed’ – by the think tank the Resolution Foundation found the retail sector’s falling employment share is a “long-term trend” that pre-dates the recent impact of online shopping. Retail’s share of employee jobs has fallen by 12% since 2003.
The Foundation’s analysis also shows that retail workers now have a higher rate of redundancies than any other sector. Those leaving retail are now also more likely to become unemployed than leavers from any other sector (31%, compared to an average across all sectors of 26%), having been in line with economy wide averages at the start of the century.
Additionally, ex-retail workers are also staying unemployed for longer than ex-workers from other sectors with two in five (41%) remaining unemployed for six months or more, the second highest of all sectors.
The Foundation also noted that this increased unemployment risk has been most significant for younger workers, with three in five unemployed ex-retail workers aged under 30, despite barely a third of retail’s workforce being in this age bracket.
However the report highlights how retail’s shrinking role as an employer has coincided with a boost in productivity and pay for those working in the sector. Productivity has increased by 40% since 2000, and typical real hourly pay in the sector has increased by over 5% in real terms since 2009 – compared to an average fall of 4% .
Daniel Tomlinson, research and policy analyst at the Resolution Foundation, said: “Retailers’ woes have hit the headlines in recent years, but this is an economic and cultural change 15 years in the making. And while big name brands will inevitably grab the spotlight, we need to focus far more on the people and places most affected by the changing face of retail.
“The good news is that job creation in other sectors – from social care to hospitality – is generating new opportunities. We are unlikely to see the large unemployment hotspots that were left behind by previous rounds of economic change.However, in recent years life has become tougher for those leaving retail, who are more likely to find themselves unemployed – and for longer too.”
He added: “So while policy makers can’t reverse major and long-lasting changes in how we shop, they can and should focus on the people and places most affected. Rather than trying to rescue the 20th Century model of shop-dominated high streets, town centres have an opportunity to diversify and become 21st Century destinations for leisure, as well as retail.”