One of Britain’s largest supermarkets, Sainsbury’s (SBRY.L) has warned that around 3,500 people may lose their jobs as the grocer shifts its business and staffing plans to accommodate the way COVID-19 has shaped shopping.
The group said in a statement that most of those roles at risk will be from the Argos chain it bought in 2016 as it looks to close 420 Argos standalone stores by March 2024, and then open 150 more outlets in Sainsbury's stores.
Sainsbury’s is Britain’s second largest grocer with 16.2% of the market share, according to data by analytics agency Kantar Worldpanel, and has a total workforce of 172,000.
“We are talking to colleagues today where the changes we are announcing impact their roles,” said Sainsbury’s in a statement.
“We recruit 55,000 Retail colleagues every year and have already hired 52,000 people since March, including 29,000 additional colleagues to support our efforts to feed the nation.
“We have many job opportunities for colleagues who work on our food counters or in our Argos standalone stores that are closing, but vacancies might not always be in the right location or at suitable hours for all colleagues.
“Whilst we will aim to find alternative roles for as many colleagues as possible, around 3,500 of our colleagues could lose their roles as a result of our proposals. Including these proposals, we expect to increase our colleague population by 6,000 roles by the end of the financial year.
“We have an excellent track record of finding alternative roles for colleagues — for example, where we have moved colleagues from Argos standalone stores to stores in Sainsbury's supermarkets, we have retained 90% of colleagues. We will do everything possible to find alternative roles for our colleagues.”
Simon Roberts, CEO of Sainsbury said that highlighted that “COVID-19 has accelerated a number of shifts in our industry” and that people shopping differently and moving online has led to around 40% of Sainsbury’s sales being digital today. During the coronavirus pandemic this share has grown, as just 10% of sales were digital this time last year.
After initially trading to the upside in the market open, Sainsbury’s shares fell by near 3% by 830am local time:
In September, Sainsbury’s said it will have doubled its pre-COVID-19 pandemic online capacity by the end of October, handling 700,000 online grocery orders a week.
Roberts said: “As we go into lockdown in England for the second time this year and restrictions are in place across the UK, we know our customers and colleagues are feeling anxious and we will do all we can to support them.
“Our colleagues have done an exceptional job going above and beyond for our customers every day which is why we are giving our frontline colleagues a second 10% thank you payment. Above all else today, I want to express my heartfelt thanks to every one of my colleagues in our stores, in our depots, and across our store support centres for all your hard work and for your outstanding team effort.”
He added that Sainsbury’s will also create a £5m ($6.5m) community fund for local charities and good causes, in addition to the £7m it donated to Fareshare and Comic Relief earlier this year.
“We want to do our bit to ensure that no one goes hungry at Christmas and to support those most in need,” he said.
Last month, research by the Institute for Fiscal Studies showed that grocery prices returned to pre-pandemic levels, after a 2.5% rise at the beginning of COVID-19 lockdowns.There has been a gradual deflation through the summer as price promotions returned to normal levels.
However this could change again, now that England is entering a second lockdown until 2 December.
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