What do Tesco’s job cuts say about the Chancellor’s autumn budget? - Jayne Dowle

Supermarkets have been quick to embrace technology and of course this impacts jobs too; the rise of the self-service till can’t be halted, the introduction of ‘dynamic pricing’ sees AI adjusting labels in response to stock levels and demand.

But Chancellor Rachel Reeves cannot afford to ignore the fact that her fiscal decisions are biting into the very lifeblood of the UK’s £216.8bn grocery business.

Tesco is the latest of the ‘big four’ supermarkets to announce a raft of job cuts, announcing that 400 roles must go across its stores and head office management.

Matthew Barnes, CEO of Tesco UK, says the firm had begun looking at a series of proposed changes in stores and head offices, explaining it was looking for “new, more efficient ways of working”.

Among those facing an uncertain future are staff at Tesco bakeries, where it’s reported the supermarket aims to move away from in-store baking to more continental deli-style products, cutbacks to management in Tesco Mobile phone shops, and many in head office management positions.

Tesco’s belt-tightening comes on the back of Sainsbury's planning to offload a colossal 3,000 staff due to a “particularly challenging cost environment', despite bumper Christmas sales. Cafes, patisseries and pizza counters will go.

Last November, Sainsbury’s chief executive Simon Roberts warned that changes in the Budget would mean an extra £140m in costs, flagging up potential “tough choices” in their wake. The way the increase was announced gave businesses insufficient time to prepare for the hike in taxes, he said.

It’s also reported that Bradford-based Morrisons is to cut 200 staff roles in a major shake-up of customer service, employee engagement and payroll.

Ultra-competitive, supermarkets are at the forefront of progress. Senior managers are tasked with difficult business decisions both daily and long-term, and must constantly adapt to changing consumer habits. In our local Asda now, for instance, there’s always a queue of couriers waiting to collect online orders for home delivery services such as Just Eat and Deliveroo.

Five years ago, before the pandemic dramatically altered human relationships with supermarket shopping, who would have imagined such a thing?

But now, people can’t even be bothered to get themselves out of the house and go and browse the shelves. Or even engage with the supermarket's own online delivery services or click and collect. Perhaps in some ways, we are agents of our own consumer destruction, but I still shop locally almost daily, to keep the faith.

A government with an understanding of the bigger picture would acknowledge such social trends and consider policies that support how supermarkets evolve.

A government with an understanding of economics would also acknowledge that the cost of living crisis is massively impacting the retail sector. It’s not only independent shops pulling down the shutters for good, but now the biggest retailers in the country are being forced to make swingeing cuts. If that isn’t cause for alarm, I don’t know what is.

Rachel Reeves should seek out and listen to the men and women who run our supermarkets and ask them to share their expertise. They know a lot more about how people spend their money than she does, that is clear.

And, current job losses notwithstanding, they understand about employment too. When the Chancellor and her colleagues speak so passionately about reducing the £303.3bn benefits bill forecast for 2024-25 and getting the unemployed into work, where do they imagine the jobs might come from? Not big employers such as supermarkets, obviously.

Supermarkets are the lifeblood of communities, a place not just to provide jobs and groceries, but the hub of towns and villages, offering invaluable service at all hours of day and night. We should not take them for granted, and neither should the Chancellor.