Retail stands as the largest private-sector employer in the UK, with nearly three million individuals engaged in various roles within shops, warehouses, transport, and corporate offices. Among them, 365,000 belong to Usdaw, encompassing individuals seeking flexible work arrangements to juggle personal commitments alongside dedicated retail professionals who have progressed to managerial positions despite limited formal qualifications.
When considering the broader scope of the supply chain, including farmers, drivers, warehouse staff, and service providers, retail emerges as a pivotal component of the everyday economy. However, the industry has faced significant challenges in recent years.
Over the past decade, the sector has witnessed a loss of 350,000 jobs, with 100,000 positions disappearing in just the last year. The closure of over 10,000 shops in the previous year alone underscores the economic impact of each job loss on families and the overall health of high streets.
In response to these challenges, the Government has proposed a new permanent reduction in business rates for retail, hospitality, and leisure establishments. This initiative aims to rectify the disproportionate burden faced by retail businesses, which contribute over 20% of all business rates despite comprising only 5% of the economy.
To finance this reduction, the Treasury is contemplating raising business rates for larger non-domestic premises, potentially affecting supermarkets and anchor stores that play a vital role in retail employment and attracting foot traffic to high streets. Such a move could lead to reduced employee hours, store closures, job losses, and ultimately higher prices for consumers.
It is essential to strike a balance between supporting retail businesses and ensuring fair taxation. Imposing additional taxes on larger stores, while excluding smaller retail establishments from higher business rates, could safeguard jobs, maintain affordable prices, and promote sustainable economic growth in towns and cities across the UK.
As stakeholders, including Usdaw and the British Retail Consortium, advocate for a brighter future for the retail sector, the upcoming Autumn Budget presents an opportunity to safeguard the industry and its workforce. By implementing a meaningful and permanent reduction in business rates for smaller retail properties and redistributing the tax burden to larger commercial buildings, policymakers can foster a more equitable and prosperous environment for all stakeholders.