LONDON (Reuters) – British retailers cut jobs by the largest amount since the depths of the financial crisis during the year to August and expect the pace of losses to accelerate, the Confederation of British Industry said on Tuesday.
The CBI data also showed an unexpected drop in its monthly retail sales balance, which fell to -6 in August from July’s 15-month high of +4. This was below all forecasts in a Reuters poll of economists, which had predicted a strengthening to +8.
The downbeat tone of the CBI data contrasts with most other indicators, including official figures which showed the volume of retail sales rose above pre-pandemic levels in July.
However, economists have warned that they expect sentiment to deteriorate as job losses mount and a government job support scheme ends in October.
“Trading conditions for the retail sector remain tough, even against the backdrop of business slowly returning. Firms will be wary of deteriorating household incomes and the risk of further local lockdowns potentially hitting them in the pocket for a second time,” CBI economist Alpesh Paleja said.
Quarterly figures from the CBI showed that the employment balance – which measures job changes over the past 12 months – sank to -45 in August from -20 in May, reaching its lowest since February 2009.
Retailers expected it to fall further to -52 in September.
The survey was based on responses from 63 retail chains collected between July 28 and Aug. 14.