Christmas shopping set to suffer as CBI reports retail woe

Tuesday, 29 November 2011 10:49

The run up towards Christmas should be a period that sees retailers increase numbers of staff but a survey by the CBI shows that stores are cutting jobs at the fastest rate in two years, fuelling concerns that this will be a quiet Christmas on the high streets of the UK.

The CBI reported that four out of every ten retailers have reduced the number of staff they employ this month, with just 13 per cent of employers increasing staff numbers. This is the weakest level of replies for two years.

26 per cent of retailers said they saw sales rise in the year to the end of November, whilst 44 per cent said they saw a fall in sales. The balance of -19 is the lowest recorded since March 2009.

Supermarkets, specialist food and drink shops, department stores and clothing retailers were hit hardest, according to the CBI.

The figures are supported by the increased levels of unemployment seen in the last reported quarter to the end of September when an increase of 129,000 was recorded in official figures from the Office for National Statistics (ONS).

Retailers reported a sixth consecutive month of declining sales and recorded their expectations that there would be a further fall in December.

Ian McCafferty, CBI Chief Economic Adviser, said: “Retailers may be hoping that shoppers will loosen their purse strings in the run up to Christmas, but consumers are likely to remain cautious about spending given the uncertain economic outlook."

Volume of sales were also at their lowest ratio since March 2009. Orders also fell in November and are likely to do so again in December.

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