Retail jobs warning with 160,000 part-time roles at risk from tax hikes

Up to 160,000 part-time retail jobs could be axed in the next three years as a result of tax changes announced in the Budget, an influential industry body has warned.

The retail sector remains the biggest private sector employer and accounts for more than a third of local jobs in 20 per cent of parliamentary constituencies, according to the British Retail Consortium.

The BRC said part-time jobs were particularly susceptible to upcoming changes in the employer national insurance contribution thresholds.

Retailers will pay tax for every employee earning more than £5,000 from April, down from the current level of £9,100.

But employers will also be grappling with an increase in the national minimum wage and an increased rate of employers' national insurance.

Helen Dickinson, chief executive of the BRC, highlighted the prevalence of younger workers in the sector, warning 'the government may be kicking away the ladder for the next generation'.

There are currently over 1.5million part-time jobs in retail, representing a little over half of all retail jobs.

This includes students making extra money during their studies, parents working around childcare, and seasonal workers providing vital support during the peak trading periods.

One in ten of these jobs could be at risk of being lost over the next three years, the BRC said, as a result of changes announced by Rachel Reeves in October.

It claimed the the rising costs of employment, higher employer NICs and national living wage will add £5billion to retailers’ labour costs this year alone.

The BRC said the impact of changes announced in the Budget would be 'compounded' by some of the proposed changes under the Employment Rights Bill, which could force firms to reduce the number of local, flexible jobs.

'This would have the biggest impact on part-time workers, including seasonal and student jobs', it warned.

Across the retail sector, 57 per cent of staff are women and 18 per cent are aged 24 or under.

In its 2025 Manifesto for Retail report published today, the BRC added: 'The risk of further shop closures on high streets will only increase.'

Dickinson, said: 'Retail is a key source of employment right across the economy.

'Retail has long offered the first rung of the career ladder to hundreds of thousands of young people, playing a vital role in communities up and down the country.

'However, between rising employer National Insurance Contributions, higher NLW costs, and incoming employment regulations, the government may be kicking away the ladder for the next generation. One in ten part-time retail roles are now at risk of being lost.'

She added: 'Retailers face a mountain of costs from the Budget and while they continue to absorb costs where they can, higher prices and job losses are inevitable.

'If the government can find ways of mitigating the £7billion of costs facing the industry this year, as well as ensuring a pragmatic approach to the Employment Rights Bill that focuses on tackling unscrupulous employers, protecting employees while supporting employment, then many jobs would be saved.'

For the three months to December, the BRC said total UK retail sales growth was 0.4 per cent year-on-year as shoppers prioritised spending on food and drink over Christmas. Once inflation was factored in, retail sales by volume fell over the year.

Earlier this month, the BRC said that around half of retailers were planning to reduce their headcount this year, while over two-thirds were increasing prices in a bid to reduce the impact of higher costs.

Last month, Sainsbury's announced plans to cut 3,000 jobs as it shut down its remaining cafés and closed its patisserie and pizza counters.

The supermarket said the move would help 'simplify the business', adding that most Sainsbury's shoppers 'do not use the cafés regularly'.

In January, Tesco also announced plans to cut around 400 jobs as part of plans to 'simplify' the business. During the same month, Morrisons said it would axe 200 roles from its 'retail people team'. Other supermarkets like Asda unveiled job cuts last year.

Last month, MailOnline revealed that more than 100 staff at WHSmith's travel stores were being made redundant.

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The firm, which now brands itself 'the global travel retailer', informed managers at around 40 per cent of its 579 travel stores across the UK that they were at risk of redundancy at the end of November.

WH Smith is in talks to sell its high street stores, prompting concern over future job losses.

This month, New Look's arm in the Republic of Ireland announced plans to shut all of its 26 stores, blaming sustained losses over a number of years and challenging market conditions.

Last week, fashion chain Quiz shut all of its 23 shops, putting around 200 jobs at risk.