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UK Retail Sales Drops and Young People More Affected By Job Losses

The CBI has recently confirmed falling retail numbers for October, leading to suggestions that the economic recovery from the initial lockdown could be stalling. Meanwhile, there is growing evidence that the employment crisis is hitting younger workers hardest.

The Figures from the CBI

The distributive trades survey in October shows the largest drop in retail sales since June, with this month weaker than expected. Among the sectors where a drop was noted were department stores, clothes retailers and non-food stores.

On the other hand, good numbers were still posted in areas such as DIY, furniture and recreational goods. This trend seems to suggest that Brits are getting ready to stay at home as new restrictions are added across the country.

Looking ahead, retail suppliers have noted a drop in the orders being made, which seems to point to a further period of weak sales looming. With the need for debt collection firms already evident, it seems that this industry is in for a tough winter.

Overall, the retail sales numbers show a drop of 22% when compared to typical market conditions, while in September this was just 14%. The CBI expects a similar performance next month, with a steeper decline in performance predicted.

Ben Jones is Principal Economist at the CBI, and he said that these figures warn us of “a further loss of momentum “in the British economy. Footfall is still down by a third but while the retail sector hasn’t had direct restrictions imposed on it, we have seen so far this year that consumer confidence is knocked as coronavirus cases rise.

The Effect on Young Workers

A different study, this time from the London School of Economics (LSE), suggests that the current jobs crisis is affecting young people more than older workers. The LSE looked at the way that people have been losing their jobs since the pandemic began earlier this year.

They found that 11.1% of people between 16 and 25 lost their jobs in the last couple of months, while just 4.6% of workers over 26 became unemployed in the same period. The study also discovered that 58% of young workers have seen their earnings drop, compared to 42% of the remainder of the country’s workforce.

They also found several other groups who are more at risk than others of losing their jobs or suffering a drop in income. These include women, those who grew up in a financially distressed family and the self-employed. The LSE warned of a possible return to 1980’s unemployment levels, particularly among the young.

The Resolution Foundation looked at the chancellor’s various schemes to help soften the impact of the current crisis, and they found that self-employed workers and younger people in the gig economy haven’t been as well protected at others.

Their full report looking at the impact that the different Treasury schemes have had will be published later this week. Among the issues, they point out that the initiative for self-employed workers gave £1.3 billion to people who didn’t suffer any loss of income, while not helping half a million others who were left out of work.