- CEO Lord Simon Wolfson warns of ‘dramatic fall’ in entry-level jobs due to government policies
- Minimum wage and NI contributions are rising, and zero hours contracts should be banned
- Brick-and-mortar stores are relying more on automation to reduce costlier workers
Lord Simon Wolfson, CEO of retail giant Next, has warned that UK government policies could cause a “dramatic fall” in entry-level job opportunities, leading to significant youth unemployment in the UK and around the world.
Wolfson quantified this statement by revealing that the company now receives an average of 19 applications for each vacant position on the shop floor, up from 10 just two years ago, demonstrating a growing appetite for entry-level positions.
Rising costs and taxes are also driving this trend, with rent increases placing additional pressure on businesses and increases in the national minimum wage and employers’ national insurance contributions also adding to the cost.
Youth unemployment is on the rise again
The CEO said rising costs, fueled in part by government policies, have introduced a new “entry-level jobs tax”, whereby the cheapest workers are no longer as cheap. The looming ban on zero-hours contracts only increases costs further, but the government believes this “unilateral flexibility” offers no security for staff.
“This doubling of applicants for store jobs is indicative of the current scale of the youth unemployment crisis,” Wolfson said in an interview with BBC.
However, reduced or zero hours contracts play an important role in the retail sector in particular, helping staff during busy holiday periods like Christmas. Wolfson fears the ban will make job opportunities more restricted for students and seasonal workers.
“Lord Wolfson, who earned more than £7 million last year, will understand how important our measures to make work pay are to workers’ financial and employment security,” a Department of Business and Trade spokesperson said.
However, the consequences of cutting entry-level staff are felt very far away. “The people who suffer the most are those with the least experience, which is the youngest,” Wolfson said, noting that the company is using more automation in stores to reduce its reliance on more expensive human workers.
Next’s share prices have fallen since the start of the year, down 2.59% this year to date.
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