The news concerning Jones Bootmaker, the 160-year-old retailer, may be rescued from the hands of the administration. However, more than 1000 workers are not sure about their future employment.
Majorly, the profits for bricks and mortar shops are fixed due to the increase of online shopping, increase in staff costs resulted in the introduction of the national living wage, and a rapid discounting price for their products. Particularly, this is designed to attract customers, but evidently, it kills the profit margins. Also, business rates are the tax that does not account for the falling profits, and recently it has become costly compared to corporation tax for many shops.
However, hope is still there on the high street shop. In particular, this is indicated on Inditex, the owner of Zara. Recently, it published a record of sales and profit annually. Though this was done by utilising full merits that benefit a physical shop. Usually, the store managers are authorised to order clothing for their shops to be tailored to the local population, and in most cases, the clothing range is changed, and lots of items are produced in Europe to ensure that shops gets new stock quickly and sell their latest fashion trends.
For new owners of Jones Bootmaker, they should contact Amancio Ortega, the Inditex founder and Europe’s richest person.
During the summer of 1975, the unemployment rate in Europe was lower compared to now. If you remember well, it was the period of UK’s first referendum on EU membership, Harold Wilson being the prime minister the inflation was at the low rate of more than 25%.
In the recent contrast, the labour market is excessive. Particularly, the joblessness rate is at 4.7%, a level that lots of economists would consider as full employment, yet in the mid-70s there was no pressure in wage rise.
In previous times, an increase in living costs was matched with the demands for higher pay, which evidently led to the rise of inflation. Finally, governments from both sides reported a statutory incomes places trying to lower the inflation rate.
The recent data from the National Statistics indicates that the UK has a non-statutory incomes policy, imposed by employers rather than the Whitehall. For the three months to January 2017, the unemployment rate was 105 000 lower compared to the previous quarter and employment increased by 92000. Still, the wage pressure is intense. According to the three months to January and December rose by 2.3% to 2.6% respectively. These figures illustrate how the modern market balance of power has changed for the past few decades.
Logically, de-industrialization and rise in employment in the unorganised service sector controls the power of trade unions and increase in labour supply. With a high level of employment, the payment weakness will limit the consumers spending’s over the coming months. The inflation rate is rising at 1.8%.
Lloyds: Chancellor on the final straight.
In conclusion, the government effort is to sell off its Lloyds Banking Group stake. Due to selling off another percentage stake will minimise the taxpayers holding to 2.95%. By early may, the government will get a chance of accessing the entire building, which initially was 43%.
Still, It’s one item to be removed from chancellor’s list. According, to Royal Bank of Scotland, the government stake is 73% and lack of return to private ownership.