Retail Confidence Up Despite Sackings
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23% of all retailers have sacked staff or closed stores a new research study conducted by the Australian Retailers Association has revealed, yet despite this retailers are optimistic about an economic recovery .

23% of all retailers have sacked staff or closed stores a new research study conducted by the Australian Retailers Association has revealed, yet despite this retailers are optimistic about an economic recovery .

The March Australian Retailers Index reveals that 23 per cent have sacked staff during the past three months while 11% have hired new employees. Among those known to be hiring are JB Hi Fi and Woolworths who own Dick Smith stores.

65% have  have maintained staffing at the same levels as when the economic downturn first kicked in. Executive director of the ARA Richard Evans says the figures show consumer confidence is hitting retailers hard.

The Index also revealed that retailers are suffering with falls in sales performance at negative 18% were doing the right thing by adjusting their business paradigm, reducing other expenses and trying to stimulate consumer spend before letting staff go.

“Although a decrease in employment levels was being considered by 14% of SME retailers in the past quarter, over 35% were reducing other costs as a result of current economic conditions. Almost 20% were adding new products and 18% were advertising more to try and stimulate consumer spend.

“Usually, employment costs are the easiest overhead for managers under pressure to cut, but SME retailers are showing responsible understanding of the importance holding onto staff to stimulate consumer spending and economic recovery.Said Evans.

“We’re urging employers right through the supply channels to hold onto their staff who have the key to economic recovery in their pockets. If unemployment levels remain under six percent , the retail sector can expect to see improved growth by the September quarter.

“If they’re still working and they’ve got a mortgage, they’ve got more cash now available to them than they had 12 months ago,” he said.

“But what we’re not seeing is consumers coming back in heavy demand. One of the reasons for that is the narrative currently is putting fear through people in Australia, and what we need to save jobs is that fear to turn around.”

Employment growth figures for small and medium retailers were the lowest within the sector over the past three months.

But Mr Evans says if the unemployment rate remains below 6 per cent, retail growth can be expected to pick up towards the end of the year.

 

“We need to start putting some confidence back into the community, and that is that unemployment less than 6 per cent is good news for Australia,” he said.

“We still have a strong balance sheet and we need everyone to be working together.

“That means that consumers need to re-enter the market place, and if they do, there’s some good deals on at the moment.”