Fashion retailer Next has disclosed a challenging job market situation, with an average of 67 applicants vying for each available position. The company noted a significant drop of over one-third in store staff vacancies over the past two years, attributing this decline to existing employees choosing to stay put amidst economic uncertainties.
Despite the decrease in job openings, applications for retail positions have surged by 72% during the same timeframe, resulting in 16 job seekers competing for each job opportunity. The competition intensifies for corporate roles, with a 121% increase in applications since 2023, equating to 67 applicants per vacancy.
Next’s CEO, Simon Wolfson, highlighted that escalating costs, influenced by the government’s rise in national insurance contributions and the growing implementation of artificial intelligence, have accelerated the adoption of automated processes in various industries. Wolfson emphasized that the impact is more likely to affect job seekers and job changers rather than those already employed.
Expressing concerns over potential consequences, Wolfson commented on the implications of Labour’s new Employment Rights Bill, cautioning that it could further diminish job opportunities and impact wages. He particularly flagged the extension of protections for zero-hours employees to those with “low-hour” contracts, foreseeing challenges for companies to provide additional hours to such workers.
While foreseeing sluggish economic growth in the foreseeable future, Wolfson also acknowledged Next’s nearly 14% profit increase to £515 million for the first half of the year. The company attributed this growth to favorable weather conditions and disruptions at competitor Marks & Spencer, which bolstered sales.
Despite the positive financial results, Next remains cautious due to the uncertain economic landscape, with the Bank of England maintaining interest rates at 4% to address inflation concerns and rising food costs. Bank Governor Andrew Bailey emphasized the need for a gradual and careful approach to any future rate adjustments, awaiting more evidence of easing inflation pressures before making significant policy changes.