60 000 jobs lost in German retail sector

Eurofood, Dec 17, 1998

A familiar story: increasing concentration in the retail sector forces employees out of a job and into the dole queue. New figures from the Federal Statistics Institute show that France and the UK are not alone-Germany has seen the disappearance of 60 000 retail jobs in the last four years. However, the downward trend cannot be attributed to concentration alone, for the increasing popularity of new business types, such as discounters, and the onset of a widespread recession have also played their role. In the first nine months of this year the number of employees in German retail has declined by 0.6% to 2.65 million.

At the trade unions alarm bells are ringing. The Retail, Banking and Insurance Union (HBV) claims that as many as 200 000 redundancies have been announced in the retail sector since 1994. Even allowing for new positions which have been created, this still leaves a deficit of some 63 000, most of them full-time. While different government bodies and unions quibble over the exact figure, it is certain that the total of jobs lost since 1994 is in the region of 60 000 -- and this figure looks likely to rise.

When two become one ...

The mergers and acquisitions which so frequently feature in the pages of Eurofood are the prime culprit. When a smaller company is taken over, a number of duplicated functions are amalgamated, with almost inevitable redundancies. Some would say that consumers too have contributed to the redundancies. An increasingly price-conscious clientele has allowed low-overhead discounters with smaller workforces to threaten conventional retailers. A prime example of this is Spar Handel. While the independent retailers continued to fade away -- 200 more put the closed sign up for good in 1997 -- Spar's Netto discount chain went from strength to strength, growing its number of outlets from 100 to 600.