Sainsbury’s to Cut 3,000 Jobs Amid Rising Costs and Tax Increases

[Social Media]

 

Sainsbury’s has announced plans to cut 3,000 jobs, marking a significant shift in the retail giant’s operations as it grapples with rising costs and the impact of recent tax changes. The cuts will see the elimination of 20% of senior management roles, the closure of 61 in-store cafés, the removal of hot food and pizza counters, and the introduction of self-service bread-slicing stations to replace bakery staff.

 

The decision comes as part of an ongoing effort to reduce £1 billion in operating costs, following the loss of 1,500 jobs last year. This year’s cuts, representing a 2% reduction in the company’s total workforce, are partly influenced by steeper employer tax burdens introduced in Chancellor Rachel Reeves’s October budget.  

 

Sainsbury’s chief executive, Simon Roberts, highlighted the challenges the company faces in adapting to a difficult economic landscape. He said, “As we accelerate into year two and beyond of our strategy, we are facing into a particularly challenging cost environment which means we have had to make tough choices about where we can afford to invest and where we need to do things differently to make our business more efficient and effective.”  

 

Roberts recently criticized the Chancellor’s £25 billion tax measures, including the increase in National Insurance contributions for employers, which is expected to add around £140 million to Sainsbury’s annual costs. He expressed frustration at the lack of time businesses were given to prepare for the changes, warning that the tax hike would have a “significant impact” on supermarkets due to their large workforce.  

 

The broader retail sector is also feeling the strain of these policies. Competitors such as Tesco and Marks & Spencer have echoed concerns that rising operational costs will inevitably lead to higher prices for consumers.  

 

Sainsbury’s is exploring redeployment options for affected staff and has pledged to offer support packages exceeding statutory requirements. While the closure of cafés and food counters will make way for more fresh food offerings, the company insists these changes align with customer preferences, noting that their most loyal shoppers rarely use the cafés. Additionally, Sainsbury’s claims that new bread recipes and self-slice stations will enhance bread quality and consistency, though it has not disclosed how many bakery jobs will be impacted.  

 

Clive Black, director of Shore Capital, described the restructuring as a reflection of broader economic challenges. “We see these next steps in Sainsbury’s Next Level programme as both a continuum and evolution of its plans in the light of the Chancellor’s Budget, one that is unfortunately very painful for those to be leaving the firm, but necessary for Sainsbury’s if it is to sustain its competitiveness to shoppers, which includes mitigation of aforementioned state-induced costs, looking after its ongoing workforce, and seeking to reward its shareholders.”  

 

Black also warned of a potential rise in unemployment across the UK if government policies fail to address the economic pressures facing businesses.  

Sainsbury’s, like many in the retail sector, is navigating a complex environment shaped by increased operational expenses and shifting consumer behaviors. These measures, while difficult, aim to position the company for long-term sustainability amid a challenging economic backdrop.  

 

Based on a report by Daily Telegraph 2025-01-25

 

 

[The Cyclist]

Sainsbury makes the headlines the reality is somewhat different

 

Quote

Employers also cut jobs at the fastest pace since the height of the Covid pandemic in 2021. Excluding the health emergency, the rate of job-cutting was the highest since the global financial crisis in 2009.

 

https://www.theguardian.com/business/2025/jan/24/uk-inflation-bank-of-england-interest-rate-dilemma-flash-pmi

 

Budget for Growth Growth Growth

 

[JonnyF]

Rachel from accounts budget for recession seems to be having the desired effect. 

 

Labour damaging the country one policy at a time. 

 

Deliberately. 

 

Self loathing Luberals have no place running countries.

[GanDoonToonPet]

3 hours ago, Social Media said:

Sainsbury’s has announced plans to cut 3,000 jobs..The cuts will see the elimination of 20% of senior management roles, the closure of 61 in-store cafés, the removal of hot food and pizza counters, and the introduction of self-service bread-slicing stations to replace bakery staff.

 

Management restructuring, eliminating loss-making parts of the business and replacing staff with automation / technology are all things that they would have done anyway...very convenient for them that the budget came along.

 

Sainsbury's made almost a billion in profit last year, and are projected to make over a billion this year, so the 140m added costs won't break the bank.

 

They have 1431 stores in the UK so I expect most of those 3000 job cuts (actually they announced 1500 before the budget) will be bread-cutting bakery staff. 🤪

[NE1]

I see Nat West are closing thousands of their high street banks .

Lots of unemployed joining the ranks.

[Justanotherone]

are people in these shops IDLE like homepro workers? overstaffed and when you ask a question, they always have to go ask 3 other collogues that does not have a clue

[herfiehandbag]

I wonder if the savings in bakery staff costs will be outweighed by the insurance premiums for "self service bread slicing machines"?

 

There are those one can observe amongst the shopping cohorts that I wouldn't trust with a pair of kindergarten scissors!

[Theforgotten1]

6 hours ago, The Cyclist said:

Sainsbury makes the headlines the reality is somewhat different

 

 

https://www.theguardian.com/business/2025/jan/24/uk-inflation-bank-of-england-interest-rate-dilemma-flash-pmi

 

Budget for Growth Growth Growth

 

Growth of the non working population,  and they are on target

[RuamRudy]

9 hours ago, GanDoonToonPet said:

Sainsbury's made almost a billion in profit last year, and are projected to make over a billion this year, so the 140m added costs won't break the bank.

 

That's an operating profit before tax is paid. Profit margins for supermarkets in the UK are around 3 to 5%.