Debenhams axes 2,500 jobs in bid to cut costs after coronavirus lockdown
Debenhams has axed 2,500 jobs as it seeks to reduce costs following the coronavirus lockdown, in the latest blow for the struggling UK high street.
The department store chain, which permanently closed 20 stores during lockdown, said the trading environment is “clearly a long way from returning to normal” after lockdown restrictions were lifted.
The latest round of cuts are on top of the 4,000 redundancies announced since May, the BBC reported, meaning the high street brand has now cut a third of its workforce.
The retailer entered administration in April for the second time in a year as it sought to protect itself from legal action by creditors during the coronavirus crisis.
The employees affected by today’s redundancy announcements, who work in stores and the retailer’s distribution centre, have been informed, Debenhams said.
Nigel Frith, analyst at Asktraders.com, said: “What we are seeing here is simple – if the firm was in a weak position going into the coronavirus lockdown, there is a good chance that it will not be coming out better the other side – and it’s looking like it won’t be.
“In recent years fast fashion and online businesses have thrived, whilst our more traditional brands have struggled to transform and adapt to the current economic climate.”
Thousands of high street jobs have been lost since the coronavirus pandemic hit the UK in March.
John Lewis, Boots, Oasis and Warehouse are among the retailers to cut staff numbers during the Covid-19 crisis.
Debenhams today that it has reopened 124 stores since non-essential stores were given the go-ahead to reopen.
The stores were trading “ahead of management expectations” it said.
“We have successfully reopened 124 stores, post-lockdown, and these are currently trading ahead of management expectations,” the company said in a statement.
“At the same time, the trading environment is clearly a long way from returning to normal and we have to ensure our store costs are aligned with realistic expectations.
“Those colleagues affected by redundancy have been informed and we are very grateful to them for their service and commitment to Debenhams.
“Such difficult decisions are being taken by many retailers right now, and we will continue to take all necessary steps to give Debenhams every chance of a viable future.”