Tesco 'Won't Be The Last' Retailer To Cut Jobs: Euromonitor
Market research provider Euromonitor International has said that Tesco's recent job cuts are a result of the increased pressures facing the UK's grocery retailers.
Tesco announced yesterday that it is cutting 1,200 jobs at its UK headquarters, and at offices in Bengaluru, India. Last week, the retailer also revealed that it is closing its customer service centre in Cardiff, Wales, cutting an additional 1,100 jobs.
"Dave Lewis has been labelled 'Drastic Dave' since his appointment as CEO in 2014 where cost-cutting and ‘improving the bottom line’ were the priority from the outset," said Philip Benton, lead analyst at Euromonitor.
"Cutting 1,200 jobs at HQ is more of a surprise than the closing of one of its call centres which cost 1,100 jobs, but remains part of Lewis’ overall strategy of protecting profit above all else."
Euromonitor says that the UK's leading grocery retailers are retaining strong shares but are facing growing pressures due to increased competition from discounters and online marketplaces, and increasing employee wages.
"The commitment from the UK Government to increase minimum wage to £7.50 per hour has prompted many businesses to prioritise investment in technology over labour," added Benton.
"It is likely that Tesco won’t be the last UK retailer to announce a series of job cuts over the coming months.”
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Sarah Harford. Click subscribe to sign up to ESM: The European Supermarket Magazine.