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High street job losses deliver £1.5bn blow to economy

Words: Huw Morris
Marks and Spencer store closures / iStock-458656561

About 25,000 jobs disappeared from the UK’s high streets in the first seven months of 2018, with a further 8,300 jobs under threat at suppliers.

An analysis by the think tank New Economics Foundation (NEF) says the job losses and those under threat of redundancy amount to a £1.5 billion hit to GDP.

At the weekend, Marks & Spencer closed seven stores as part of a plan to close 100 outlets by 2022. DIY chain Homebase is expected to unveil a major closure programme later this week.

The NEF says the findings do not mean that GDP is necessarily weaker than it would otherwise have been, as new jobs and output may have been created elsewhere in retail or in the broader economy. However, the findings illustrate the shift in economic importance away from the high street during 2018 so far.

“The shape of our economy is beginning to flex and buckle in response to powerful structural forces such as weakening household spending power and a shift in consumer behaviour towards online purchasing,” says head of economics Alfie Stirling. “But moments like these also represent an opportunity for policymakers, businesses and communities to proactively choose a new direction going forwards.

“The high street has always provided space for tremendous economic and social value in the UK. But if these broad benefits are to be preserved, the future may need to be reimagined with less dependency on short-term material consumption.”

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Image credit | iStock