Supermarkets Should End Misleading Job Creation Claims
Local shops have called on the supermarkets to stop using misleading claims about job creation to create local support for their development proposals.
ACS (the Association of Convenience Stores) unveiled a new study which exposes the tricks of the trade employed by the major retailers seeking to charm local communities and councils into approving their new store proposals.
The study calls on a wealth of evidence from academics suggesting that the ‘hundreds of jobs created’ notion3 is based on inconsistent forecast criteria, ascribes equal value to all types of job from full time supervisors to ‘Saturday kids’ and takes no account of the likely loss of jobs from shop closures arising in other retail developments.
In one current example, traders in Bishop’s Waltham, Hampshire fear for their livelihoods after plans for a 30,000 sq ft Sainsbury’s store were submitted earlier this month.
Sainsbury’s have claimed that 250 jobs will be created by the new store, but Andrew Grover, Chairman of the Chamber of Trade thinks differently: “Such a large supermarket would inevitably reduce footfall on the high street and put many local traders businesses at risk leading to inevitable job losses”.
The Association has written to the Chief Executives of the big four supermarkets, local councils and Planning Minister Bob Neill MP calling for a new and consistent methodology for basing any job claims.
ACS Chief Executive James Lowman said: “While supermarkets claim to bring prosperity and employment to a town, we know all too well the damage that can be done to high streets if the wrong supermarket is built in the wrong place. Local businesses often have to cut staff and some even are forced to close as a result of a new development nearby.
“We hope that this study will alert local councils to the tactics used by supermarkets to push their applications through. Bold employment claims are often essential to a development being approved under new planning policy6, so exposing the truth behind these figures could be crucial to the survival of Britain’s high streets.”
Case Studies Below
Shane Brennan, Public Affairs Director
01252 533009 / 07921 372978
Chris Noice, Communications Assistant
Notes to Editors
1. The full report, “Job Creation Claims in New Supermarket Retail Developments” can be found at the following link: www.acs.org.uk. It calls for supermarkets and councils to use a consistent approach to job creation claims:
a. use only full time equivalent positions (and not a total headcount including casual and part-time staff)
b. use a standard timeframe of 18 months for projections
c. use a standardized approach to calculating the associated job losses that comes with removing trade from existing businesses.
2. ACS (Association of Convenience Stores) is the campaigning voice of local shops, representing over 33,500 convenience stores. ACS helps local shops thrive through lobbying, support and networking opportunities.
3. “350 Tesco jobs hopes for Middleton” (2nd March 2010) http://www.middletontoday.co.uk/news/350-Tesco-jobs-hopes-for.4991562.jp
“Morrisons creates 800 jobs with new stores” (25th January 2010)
“300 new jobs as Asda gets go-ahead” (9th January 2009)
4. According to Porter and Raistrick (1998) using the FTE method, developments generated an average net loss of 276 jobs.
5. A Tesco funded report by EDAW (1999) using the head count method claims that developments generate an average net gain of 236 jobs.
6. Planning Policy Statement 4 can be found at the following link: http://www.communities.gov.uk/publications/planningandbuilding/planningpolicystatement4
ACS Job Creation Case Studies
Bishops Waltham Sainsbury’s
Where: Abbey Mill, Bishops Waltham
Size: 30,000 sqft
Current Situation: Application Registered, Consultation Period Ends 05/08/2010
Employment Impact - Sainsbury’s: 250 jobs created
Employment Impact – Local Traders: At least as many job losses.
“Asking local businesses to anticipate job losses was a particularly difficult task, but in our recent survey the majority of retailers (not only of food) felt that it would be very likely indeed that they would suffer a serious reduction in footfall and cut costs accordingly by shedding staff. This contraction in local retail sales will naturally ripple out along the local supply chain to the producers and manufacturers who will in turn have to respond in like fashion to the downturn in their trade.” Robin Shepherd on behalf of the Bishops Waltham Action Group.
In the economic development study the supermarket planners explain the job creation benefits of the planned development but do not reference any displacement of jobs suggesting that the supermarket will actually reduce leakage to out-of-town stores and increase trade to the high street due to the construction of a walkway, resulting in nil trade diversion.
The Bishop’s Waltham high street as it stands is focused on small, independent grocers. These traders believe that their trade will be decimated by the introduction of a supermarket making their business unsustainable and leading to widespread job losses. Local businessmen harbour serious concerns and suggest that the planned walk way is unlikely to integrate the supermarket into the high street due to the distance involved. Indeed the site is actually outside the definition of edge of centre, highlighting the distance from the proposed site to the high street.
As well as fierce opposition from the Bishops Waltham Action group, on the 6th July 2010, the Chamber of Trade also voted to oppose the development. Andrew Grover, Chairman of the Chamber, who also owns a butchers on the High Street, said: “Such a large supermarket would inevitably reduce footfall on the High Street and put many local traders’ businesses at risk... Sainsbury’s efforts to create a link to enable their customers to come into town simply won’t work over that distance.” (www.thisishampshire.net)
Where: Chapel Hill
Size: 49,000 sqft
Employment Impact - Tesco: 400
Employment Impact – Local Traders: Quote coming from Town First – due 20/07/2010
“We are sceptical of the claims about hundreds of new jobs that will be created if the proposed new ASDA and Tesco stores just outside the ring road are approved. Firstly, the new jobs are mainly minimum wage and a lot are part time. In time as many existing jobs in the town as those created will be lost. Some will be lost directly by other retailers slimming down the workforce or closing down. We also expect to see job losses in other local service providers (like shop fitting and accountancy) and suppliers to local shops. The advent of 24 hour drive supermarkets close to the town centre with an ever expending range of goods and services will have an adverse effect on a lot of existing sectors from specialist food stores like butchers and greengrocers, to school uniform suppliers, bookshops, florists and pubs. This will add to the number of empty retail premises in the town centre - and potentially in local neighbourhood shopping centres close to town like Lockwood and Springwood.” Chas Ball on behalf of Town First.
Town First is an action group campaigning against this development and a Tesco planned for the same area. The group believe there will be significant impact in the high street and not just in grocery stores.
Where: Stalham, North Norfolk
Employment Impact – Tesco: 188
Employment Impact – Local Traders: 25% employment reduction in one business alone
“When the supermarket arrived near the town they claimed they would create 188 jobs but the net employment loss to Stalham town centre has been far greater. The knock on effect to my staffing structure was massive, I had to let 25 per cent of the staff go to keep the business profitable.” Nigel Dowdney, Local Trader, Stalham,.
Stalham is a market town but the proposed Tesco was located on the market site. Tesco planners asserted that the market would be allowed to continue but subsequently rescinded the offer. The market was relocated and the high street has subsequently suffered from significant trade diversion and high street store closures. Despite Tesco’s assertions that no ill effects had been felt, a pedestrian flow analysis mimicking an earlier council study, revealed that this had reduced in every area studied and in some by as much as 87%. This highlights significant trade diversion not foreseen in the Tesco planning application