UK retailers have been cutting jobs at the fastest pace since the financial crisis, according to figures from the CBI that point to an extended period of gloom for the sector.
The data also showed an unexpected drop in a measure of sales – after they had picked up in July.
Official figures published last week suggested that retail sales had recovered last month to pre-pandemic levels.
However, there are fears that consumer confidence could weaken as job losses mount and the government’s furlough scheme, supporting temporarily laid-off workers, ends in the autumn.
CBI economist Alpesh Paleja said: “Trading conditions for the retail sector remain tough, even against the backdrop of business slowly returning.
“Firms will be wary of deteriorating household incomes and the risk of further local lockdowns potentially hitting them in the pocket for a second time.”
Figures for the year to August showed a measure of retail sales dropped from -6, down from +4 in July – after economists had pencilled in an upturn for the sector.
Food stores and furniture and carpet sellers were among the few not seeing a decline according to the poll, published hours after DFS revealed it had enjoyed better than expected sales in recent weeks.
The CBI’s quarterly employment balance, measuring job changes over the last 12 months, sank to -45 this month, down from -20 in May, reaching its lowest level since February 2009.
The survey, based on responses from 63 store chains, also pointed to a worsening picture to come with a balance of -52 for the quarter ahead.
Britain’s retail sector has already suffered the biggest hit from the coronavirus jobs crisis so far, representing one in four of publicly-announced cuts in a tracker compiled by Sky News.
The more than 30,000 roles axed include nearly 8,000 at Marks & Spencer and 4,000 at Boots.