Rising living costs will hasten ‘high streets’ decline

Subject

Retail sector woes.

Significance

The trend towards online shopping is progressing fast in the advanced economies at the same time as rising housing, transport, health and utility costs are squeezing incomes and adding to the decline of traditional retailing. Sharply weaker UK consumer spending is putting yet more pressure on retailers’ profit margins, forcing rapid cost cutting, restructuring and the widespread closure of less viable outlets. Job losses and vacant retail premises are rising; the latter adding to urban decay in the worst affected areas.

Impacts

• Retailing job losses dominate headlines but shop closures will have a larger and more pernicious impact on economic and social conditions.
• If UK regeneration efforts gain momentum and boost the budget and the government popularity, other regions could follow the UK template.
• Action needs to be taken to find urban redevelopment solutions and to boost public confidence in the positive effects of new technologies.