Shops closing at record rate as half of stores plan to axe more workers

BRITAIN’S shops are shutting at a record rate and the collapse of Blockbuster, HMV and Jessops will make the situation even worse in the coming months, according to data published today.

The number of stores in the UK fell by 3.6 per cent year-on-year between October and December, the biggest drop since the British Retail Consortium (BRC) began issuing its retail employment monitor in 2008.

In December alone, 573 shops shut their doors for the final time, with experts warning the figure could rise further.

Helen Dickinson, director-general at the BRC, said: “We’re by no means out of the woods yet – given the administrations of recent weeks, the next quarter’s figures are likely to make difficult reading.”

Christina Tolvas-Vincent, head of retail employment at law firm Bond Pearce, which helped compile the figures, agreed. She said: “After a lacklustre Christmas, the New Year has started badly for retailers; well publicised failures such as HMV, Jessops and Blockbuster have yet again placed the spotlight on the struggling high street.

“This will have an even greater impact on store numbers that are already falling at the fastest rate for over four years.”

The BRC survey revealed that the number of workers in the retail sector increased by 0.6 per cent year-on-year during the final quarter of 2012, although all of the growth came from part-time posts.

But Dickinson warned: “Half our sample intend to decrease staffing levels during the first quarter of this year and only 4 per cent plan to increase them.

“This trend is to be expected at this time of year due to reductions in temporary seasonal staff, but the rate is higher compared with last year and further highlights the testing times that are still to come.”

Dickinson called for government action to help tackle the challenges facing retailers.

“Supporting retail sector investment and employment is essential to economic recovery,” she said. “The UK government can help by freezing business rates in April.”

Although business rates north of the Border are set by the Scottish Government, the Holyrood administration tends to follow the example set by Westminster.

News of record number of shop closures came a day after shopping centre operator Land Securities revealed that its sites in Scotland enjoyed a busier Christmas than its operations in England.

Like-for-like sales at the businesses in its Scottish centres rose by 4 per cent during December, compared with a rise of just 1.2 per cent for the UK as a whole.

Katherine Armstead, senior portfolio manager for Land Securities in Scotland, said: “November proved to be a quiet month in Scotland, with sales and footfall ramping up in December.

“This would suggest that Scottish shoppers waited until the last minute to begin their Christmas shopping.”

Land Securities – which owns the Bon Accord and St Nicholas centres in Aberdeen, the Overgate in Dundee, the Centre in Livingston and Buchanan Galleries in Glasgow – added that it has launched free wireless internet access and Google’s product search facility in its sites to support retailers.