The effects of the coronavirus crisis on the economy have been laid bare as multiple high profile firms have unveiled plans to cut thousands of jobs each as well as site closures in an attempt to preserve cash and restructure themselves.
On Thursday, department store chain John Lewis confirmed that it will close eight of its 50 stores which is expected to lead to 1,300 job losses.
This was followed by an announcement from Walgreen Boots Alliance Inc (NASDAQ:WBA) that it will be cutting 4,000 staff at its Boots UK pharmacy chain alongside the closure of 48 Boots Opticians and a 20% cut in staff in its support offices.
The decision followed a 48% plunge in sales at Boots UK in the three months to May 31 even though stores had stayed open as essential businesses throughout the lockdown.
The decision came as the group warned of a US$1.5bn cash hit from reducing a hedging position on future business by US$10bn to US$27bn.
Around 3,000 Rolls-Royce workers in the UK have already applied for voluntary redundancy.
Burger King’s UK boss, Alasdair Murdoch, has also told the BBC that the economic hit from the pandemic could force the group to close up to 10% of its stores in the country.
Cuts, cuts, cuts
Despite Boris Johnson’s pledge of creating “jobs, jobs, jobs” to lift the UK economy out of the coronavirus slump, the last few months have seen multiple companies announcing thousands of layoffs as the pandemic either forced them into conservation mode or exacerbated existing problems in their businesses.
Other firms that have previously announced large redundancy programs include Royal Mail PLC (LON:RMG), which unveiled plans in late June to axe 2,000 jobs or more than 20% of its managerial staff as part of a shake-up to save £130mln.
Builders merchant Travis Perkins PLC (LON:TPK) has also said it will cut 2,500 jobs, around 9% of its workforce, and close around 165 branches as part of a restructuring to maintain its competitiveness, while British Gas owner Centrica PLC (LON:CAN) has unveiled 5,000 jobs will be lost and its board will be downsized through what it said was a “significant restructure” to streamline and simplify its business model.
One of the biggest job cutters ahs been oil giant BP PLC (LON:BP.), which in early June unveiled plans to sack 10,000 employees, around 15% of its workforce, as part of a strategy to save US$2.5bn amid a slump in oil prices.