Government urged to prioritise high streets or risk losing seats to Reform
A retail lobby group has warned that job losses in the sector could overwhelmingly affect areas at risk of turning from Labour to Reform.
The Retail Jobs Alliance (RJA), made up big names like ASDA, Primark, Sainsbury’s and Tesco, found that retail is a major driver of local employment in areas where Reform made significant gains in the local elections.
Tax changes have put retail under significant financial pressure, with recent increases to National Insurance and plans to levy a higher rate of business rates on larger stores set to exacerbate pre-existing issues.
The sector is set to lose 300,000 jobs by 2028, and figures from Adzuna in April showed a 43 per cent drop in the number of retail jobs year on year.
“The Government stood on a manifesto to reduce economic inactivity and protect our high streets. The rising costs facing retailers including a proposed increase in business rates means that these commitments are in jeopardy,” a spokesperson from the RJA said.
Part of the reason high streets are under so much pressure is long-term structural trends like the move to online shopping and the growth in retail parks over town centres, which are unlikely to abate.
But the RJA said business rates risk being the “straw that breaks the camels back” for retail.
The Non-Domestic Rates Bill is set to introduce a higher multiplier for business with a rateable value – market price – of over £500,000, using the proceeds to set a lower tax for smaller businesses.
Commercial real estate agents Colliers has previously labelled the bill “poorly thought out” and “growth strangling”, despite government insistence it will help small business on the high street.
A Treasury spokesperson said: “We are a pro-business government creating a fairer business rates system that protects the high street, supports investment, and levels the playing field.
“Our reform to the business rates system will introduce new, permanently lower business rates in 2026 while removing the £110,000 cap, benefitting over 280,000 retail, hospitality and leisure business properties. This will be sustainably funded by a new, higher rate on the 1% of most valuable business properties.”
However, High Streets UK has also labelled the bill a “disaster for jobs, investment [and] growth”.
“Left behind” areas in England, which are more likely to vote Reform, tend to have higher rates on reliance on retail jobs – in Ashington, a council seat which Labour only just held from Reform UK, just over one in four people are employed in retail.
In West Auckland, a council seat that Labour lost to Reform last week, 27 per cent of people are employed in retail.
“Shops up and down the country employ millions of people. In some communities, retail is the single largest private sector job creator,” the RJA spokesperson said.
“With 300,000 people set to leave the sector, a further increase in business rates could be the ‘straw that breaks the camel’s back’ for retail.”