UK retail employment has fallen to its lowest level since records began, according to the latest Office for National Statistics (ONS) data, highlighting sustained pressure on the country’s labour market and raising concerns about future job creation.
There were 2.86 million retail jobs in December 2025. The four-quarter average, which smooths seasonal hiring, stood at 2.81 million for the year—down 68,000 from 2024 and 383,000 lower than in 2015. This marks the lowest level recorded for UK retail jobs.
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Long-term decline in UK retail jobs
The figures confirm a steady contraction in the UK retail workforce over the past decade. Both full-time and part-time roles have declined, reflecting structural changes in the sector and shifting business models.
Industry data show that full-time retail employment fell to around 1.28 million in 2025, while part-time roles dropped to approximately 1.52 million, together accounting for the overall decline.
The reduction in retail jobs comes despite broader employment levels in the UK remaining relatively stable in recent years. The trend points to a sector undergoing long-term adjustment rather than a short-term downturn.
Helen Dickinson, chief executive of the British Retail Consortium (BRC), said the loss of jobs reflects deeper challenges facing employers. “People everywhere are struggling to find jobs, youth employment is falling faster still,” she said, warning that “the UK faces the prospect of a jobless generation.”
Rising costs and business pressures
Retailers have faced a sharp increase in operating costs, which industry groups say is affecting hiring decisions. Employment costs rose by around £5 billion in 2025, driven by higher employer National Insurance contributions and increases to the National Living Wage.
These cost pressures have led many businesses to reduce staff hours, freeze recruitment or cut roles. Surveys of retail finance leaders indicate that over half plan to reduce overtime or hours, while nearly a third expect to pause hiring.
Retailers are also investing in automation and productivity measures to offset labour costs, contributing to a shift in workforce demand. This reflects a broader trend across advanced economies, where technology adoption is reshaping employment patterns in customer-facing sectors.
Dickinson noted that the sector’s traditional role as a major employer is under strain. “One in five people had their first job in retail,” she said, adding that this “vital step on the career ladder is cracking under the high costs of employment.”
Impact on youth employment
The decline in UK retail employment has implications for youth employment, as the sector has historically provided entry-level roles.
Around 780,000 young people work in retail, representing more than a quarter of the workforce and making it one of the largest entry points into employment.
Industry groups warn that fewer retail jobs could limit opportunities for young workers, particularly as youth unemployment rises and the number of people not in education, employment or training approaches one million.
Flexible and part-time roles, often used by students and early-career workers, are seen as especially vulnerable. The BRC has cautioned that changes to employment regulation and rising costs could further reduce these opportunities if not carefully implemented.
Dickinson said that local retail roles remain important for those entering the workforce. Such jobs, she noted, are “important first steps into work for young people,” but risk becoming less available as businesses adjust to economic and regulatory pressures.
Ultimately, the latest ONS data underline a structural shift in the UK retail sector, with employment continuing to decline amid rising costs and operational changes. For international observers, the trend reflects wider challenges facing retail labour markets, including cost inflation, automation and changing consumer behaviour.
