Labour Must Learn Lessons from History as Automation Hits Jobs Market
Retail vacancies in the UK fell by about 6% in November, reaching a decade-low outside the Covid period, according to Adzuna. This decline reflects broader changes in the sector as productivity rises due to increased automation, which is replacing relatively expensive human labour.
Automation in retail now includes technologies such as self-service checkouts, electronic shelf labels, handheld scanners, and AI facial-recognition displays. This surge in automation investment is a key response to recent Labour government tax changes.
Employment costs have risen significantly following a £25bn national insurance hike and higher living wage requirements. The British Retail Consortium links these increased costs to more expensive hiring and a stronger drive toward automation.
Over the past decade, retail employment has declined by more than 350,000 jobs, with lower-skilled entry roles and young workers bearing the brunt of this reduction. Additional factors encouraging automation include reduced access to immigrant labour, rising ill-health, and increased early retirement, with policy choices amplifying these effects.
Surveys in the industry show that automation investment ranks second only to price increases as businesses' reactions to Labour's business tax changes. There are notable historical parallels with the Industrial Revolution, emphasizing the need for the current Labour government to manage the transition carefully and invest in upskilling workers.
The Bank of England warns that job displacement is likely due to automation and stresses the importance of retraining. Analysts like Tera Allas highlight the potential for technology to create new forms of work but caution that managing this transition is crucial to avoid leaving workers behind. Labour faces important lessons from history to ensure productivity gains are inclusive and fairly shared.
