October 25, 2020

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Online shopping makes many high street jobs unviable, says Next boss

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© Provided by The Guardian Photograph: Dan Kitwood/Getty Images The Next chief has said the...



a person walking down a street in front of a store: Photograph: Dan Kitwood/Getty Images


© Provided by The Guardian
Photograph: Dan Kitwood/Getty Images

The Next chief has said the shift to online shopping triggered by the lockdown has made thousands of traditional retail jobs unviable.

The high street has been one of the worst-hit sectors of the economy with nearly 125,000 jobs lost in the UK in the first eight months of this year as retailers closed stores and in some cases went into administration.

Simon Wolfson said what looked to be a permanent shift to online spending had created work for warehouse staff and delivery drivers but that in the long run fewer people were going to be needed in shops.

“I wouldn’t want to underestimate the difficulty that is going to cause a lot of people who work in retail, I think it’s going to be very uncomfortable,” he said.

Next has emerged from the crisis as one of the high street’s most resilient brands. Last week it raised its profit guidance for a second time as the company’s sales recovered from the shock of the lockdown when its stores were closed for several months.

The chancellor’s winter jobs plan, announced on Thursday, was “very sensible”, Wolfson told the BBC. The Tory peer suggested it was “important that employers begin to pay a little bit more for the schemes and that employees get a little bit less … Otherwise I think there’s a risk that our economy will just become hooked on it.”



a person walking down the street in front of a store: A branch of Next in Oxford Street, central London, during lockdown. The CEO says the move online threatens thousands of high street jobs.


© Photograph: Dan Kitwood/Getty Images
A branch of Next in Oxford Street, central London, during lockdown. The CEO says the move online threatens thousands of high street jobs.

As party of the government’s emergency coronavirus support package, retailers have been granted a business rates holiday. However Wolfson complained the current system was “unfair” and bills for the warehouses used by online retailers needed to rise to reflect the new high street reality.

Business rates are calculated by multiplying a property’s rental value by the multiplier (the number of pence-per-pound of rateable value you need to pay in tax). Bills have risen steeply in recent years partly because the 2015 revaluation of property values was delayed until 2017. The multiplier has also risen from 34.8p in the pound back in 1990 to 51.2p for stores paying more that £51,000 in rent.

“Over the last six or seven years the price of warehousing has gone up dramatically, and the price of shops have come down dramatically, but both of their rates have remained exactly the same,” Wolfson said.

“You could raise rates on warehousing between 30% and 50% and that would make up for some of the loss and that would be fair.”

Video: UK unveils new plan to protect jobs (France 24)

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