Retail is an exciting, dynamic and diverse industry. It is a driving force in our economy, generating £94bn of GVA in 2017, paying £17bn in business taxes, collecting £46bn in VAT receipts in 2017. It is the UK’s largest private sector employer, with 3.1 million colleagues across the UK, 9% of all UK jobs. Retailers touch the lives of millions of people every day, supporting vibrant communities where they operate.
The industry is going through a period of profound change. Technology is changing how people shop, costs are increasing, and consumer demand is softening, together creating a perfect storm that is driving structural change across the industry.
The industry is transforming and getting fit for the future. £5.4bn has been invested in new technology, responding to changing customer needs. Job numbers are falling overall, and automation and AI will replace some tasks, but there will be new, higher-skilled roles in retail. 100,000 new types of jobs in retail have been created in recent years. Average pay increased by 4.4% in 2017. Productivity growth at 3.7% outpaces the UK economy (1.1%). Profitability remains low on average – 2.5%, down from 4% in 2013 – while the price of goods in the past 5 years has fallen 5%, and consumer prices overall are up 8%.
Store numbers fell by 3,200 between 2015-18 but retailers are investing in new store formats, creating new experiences for their customers. Online makes up 18% of all retail sales, and this will continue to grow – as high as 50% by 2030. These changes have significant implications for the industry, our economy and society. The Retail Sector Council will ask what change means for the consumer and society, and how the sector should respond.