Issue 81:

Save Our Shops special

September 2019

the bulletin of
theActivist members in

What strategy can end

the retail jobs massacre?
Iain Dalton, chair, Usdaw Broad Left

T
he last few years have seen swathes
of closures of shops across the UK as
whole chains have collapsed while others
close considerable numbers of stores. In
2018, the Centre for Retail Research said that
18,443 stores closed, while 137,719 retail
jobs were lost, the worst year since the 2008
economic crash.
The huge scale of this crisis, which looks set
to grow in 2019, has forced the shop workers’
union Usdaw to launch its Save Our Shops
campaign.
The second day of action was at the end of

photo Richard Groves

June, in addition to the launch of the union’s
Industrial Strategy for Retail at parliament,
attended by MPs including Labour’s shadow
chancellor John McDonnell.
The strategy makes numerous suggestions
derived from policy passed as Usdaw
conferences - many of which socialists fully
support. These incorporate the major points of
Usdaw’s Time for Better Pay campaign, such
as changing redundancy law to remove the
loophole which allows chains to close stores of
less than 20 employees without consultation.
The Save Our Shops campaign itself is
summarised in three core demands:
„„ Economic measures to create a more level
playing field between the high street and
online retailing.
„„ Fair pay and job security for retail workers -
a minimum wage of £10 an hour, tackling zero-
hour and short-hour contracts and investment
in skills and training
„„ Government action to protect jobs in the
retail sector. Retail jobs are real jobs - retail is
a key part of the economy providing jobs and
income for millions of families
4.5m jobs
Despite the crisis, retail remains an important
part of the UK economy. It is the largest
employment sector with 3 million people
employed and a further 1.5 million jobs directly
dependent upon it.
Even with the growth of online retail, most
shopping still takes place in stores. The
strategy cites statistics showing that online
sales accounted for 18.6% of all retail sales in
the UK in March 2019.
It also cites Next’s annual report for 2019
which pointed out that “every additional order
online has increased variable costs, such
as warehouse picking and delivery costs...
Last year, every pound of Next business
that transferred from retail to online cost an
additional 6p.”
Other interesting facts are that 80% of their
online returns come through stores and half of
their online orders are delivered to stores.
Online retailing is clearly here to stay. And in
some areas, such as music and non-physical
media, it may be very significant. But physical
stores are still important to many customers.
This is reflected in online giant Amazon’s
moves to establish physical stores by buying
the Whole Foods chain, establishing seven
Amazon Go stores in the USA as well as
various ‘pop-up’ shops. Indeed the strategy
advocates retail companies establish a ‘clicks
and mortar’ approach.
But online-only companies do benefit from
an uneven playing field linked to the question
of rents, taxes and business rates.
All retailers require adequate warehousing
and a logistics network, but bricks-and-mortar
retailers have the additional overhead of a
network of shops across the country which
accrue additional business rates to online
>continued on back
join the socialists
Come to the Activist fringe meeting or
text join with your name & postcode
to 07761 818206
e: join@socialistparty.org.uk
t: 020 8988 8777
f: Socialist Party

usdawactivist.wordpress.com ■ usdawactivist@gmail.com ■ Facebook: ‘Usdaw Activist’ ■ Twitter: @UsdawActivist

theActivist
>continued from front
retailers. For example, the strategy cites
Tesco paying business rates of £700 million
in 2016-17, while Amazon paid £63.4
million.
The report essentially argues for a
reorganisation of taxes without coming
down on a particular formula.
However, the strategy does quote Tesco
CEO Dave Lewis saying: “I believe it’s time
to consider an online sales levy... 2% would
raise £1.5 billion... that could fund a rate
cut of 20%, levelling the tax playing fields
between physical retailers and their online
competitors.”
This essentially would equate to a tax cut
for the big retailers such as Tesco at the
expense of the online retailers, in effect
a form of protectionism for the bricks and
mortar retailers.
Indeed, as the strategy points out, any cut
in business rates would have a big impact
on the finances of local government, which
is increasingly dependent on this source of
income due to government ‘reforms’ cutting
their finances over the last decade.
The strategy also calls for reducing tax
avoidance, which we would fully support.
Yet it highlights the problem that even
the most progressive tax reform will face
attempts from retail companies to avoid
it, stating “...we know of instances where
online retailers are reporting their sales
through separate companies registered in
countries such as Luxembourg... There is no
easy solution on this front.”
This is because we are dealing with
capitalist corporations driven by the need to
maximise profits.
The report is hampered by its failure to
recognise this source of the crisis in retail.
Numerous points are made in the strategy
about the short-term outlook of the retail
bosses, but this is not fully drawn out.
It is the very nature of the capitalist
system, driving companies by the need to
generate profits to meet the demands of
shareholders that forces them into this
socialism2019.net
a weekend of discussion & debate on socialist ideas
to change the world
Hosted by the
2&3 November 2019
central London
usdawactivist.wordpress.com ■ usdawactivist@gmail.com ■ Facebook: ‘Usdaw Activist’ ■ Twitter: @UsdawActivist
the bulletin of
short-term outlook.
While some retailers, and indeed
representative bodies such as the British
Retail Consortium, may recognise this and
even support some reforms, this is not the
same as those retailers being prepared to
be the first one to put their profits on the
line and implement such reforms.
The strategy’s approach to trying to win
such demands includes “legislation to
ensure that workers have guaranteed seats
on the boards of large companies, with the
same duties and responsibilities as other
directors.”
But the experience of British Leyland
and other companies where such worker
representation on boards existed in the
past was that this was used to gag those
representatives, forcing them as a minority
to support the bosses approach. This
inherently undermines collective bargaining
for workers (which the strategy also
supports) as their representative(s) on the
board can be seen to be responsible for, or
supportive of, employers’ attacks on pay,
terms and conditions, and other negative
policies.
Indeed, retail workers are increasingly
fighting the attacks by the bosses with
strikes by Usdaw members at Tesco and
Sainsbury’s distribution centres as well as
strikes at Matalan, Wilko and the looming
Asda dispute around ‘Contract 6’.
The crisis on the high street means
that the big supermarkets are all cutting
thousands of jobs and imposing worse
terms and conditions. Retail trade unions
should launch a joint campaign, including
future coordinated industrial action, to
stop this ‘race to the bottom’, instead of
proposing workers sit on the boards waging
these attacks.
Public ownership
The best way to develop the real
‘collaborative approach’ the strategy talks
about is to remove the capitalist profit
motive from the equation altogether to
socialistparty.org.uk
members in
allow a genuine collaboration between
working people across retail and associated
sectors. The only way to do this is to
bring the big retail companies into public
ownership under democratic workers
control and management.
At Usdaw’s 2017 conference members
passed a motion calling for raising “the
question of nationalisation of companies
who go into administration or other
situations where the jobs of our members
and other retail, distributive and allied
trades workers are under threat.”
The resolution went on to argue:
“Bringing such companies into public
ownership, would save jobs and stores,
while the government could pursue their
former owners regarding any alleged
irregularities.
“Such nationalisation, should not be
of a top down nature, but of one run
on a democratic basis [to] allow staff
representatives, customers representatives
and the wider trade union movement to
be involved in the revitalisation of these
companies.”
Usdaw should be putting forward the
ideas from this proposition as the core
of its industrial strategy for the sector. It
means not bowing to the inevitability of job
losses and store closures but fighting to
take control of companies out of the hands
of (mis)management that have led to such
closures and staffing cutbacks.
This is also the most efficient way
of making use of “the knowledge and
experience of staff” talked about in the
report.
This needs to be linked to a wider
programme of public ownership including
the banks, transport and big manufacturing
companies to develop a democratically
planned and integrated economy capable
of meeting the material needs of ordinary
working-class people.
Only such a strategy can save the high
street while creating a society capable of
delivering for workers.
socialism
2019