UK retailer M&S axes 7,000 jobs on virus fallout

UK retailer M&S axes 7,000 jobs on virus fallout
M&S is planning to cut thousands of jobs as a result of the coronavirus pandemic

Tolga AKMEN,AFPAugust 18, 2020

Marks and Spencer, the British retail chain selling clothes and food, is to cut around 7,000 jobs as the coronavirus pandemic increasingly pushes customers to shop online, it said Tuesday.

The job cuts, to be carried out over the next three months, include losses from its central support centre, in regional management and in its UK stores, M&S said in a statement.

Marks employs more than 80,000 staff, of whom the vast majority work in the UK.

Chief executive Steve Rowe said the company would become a “leaner, faster business set up to serve changing customer needs”.

Alongside the job cuts, M&S “expects to create a number” of positions to help the group meet a surge in online demand for its products.

While total group sales slumped by around one fifth in the 19 weeks to August 8 — which included most of the period Britain was in lockdown — online revenue surged nearly 40 percent, Marks said Tuesday.

“It is clear that there has been a material shift in trade and whilst it is too early to predict with precision where a new post-COVID sales mix will settle, we must act now to reflect this change,” Marks said. 

The company joins the likes of UK department store chains Debenhams and John Lewis, as well as pharmacy group Boots, in cutting thousands of jobs owing to fallout from COVID-19.

Official data last week showed that Britain’s economy shrank by one fifth in the second quarter, more than any European neighbour, as the lockdown plunged the country into its deepest recession on record.  

Even though the UK economy is beginning to rebound as the government eases strict confinement measures — gross domestic product grew by 8.7 percent in June — analysts expect a surge in unemployment by the end of the year.

Finance minister Rishi Sunak plans to end in October the government’s furlough scheme that is paying up to 80 percent of wages for around 10 million workers during the pandemic.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Create a free website or blog at WordPress.com.

Up ↑

%d bloggers like this: