Marks & Spencer to axe 7,000 jobs

Marks & Spencer is to axe around 7,000 jobs as part of a further shake-up in the face of the Coronavirus crisis.

M&S confirmed that the bulk of the cuts would be made across its stores, hitting around 12% of its 60,000 shop-based staff, as well as a smaller number of support centre and regional management workers.

The roles are set to disapear over the next three months as M&S ramps up its overhaul, dubbed "never the same again".

M&S expects a “significant” number of roles will be cut through voluntary departures and early retirement while it said it will also create some jobs through investing further in online warehousing and its new ambient food warehouse.

The group’s latest jobs cull follows 950 jobs job losses announced just last month across store management and head office roles.

But it insisted there were no further updates on stores closures as it ploughs on with an ongoing review of its shop estate.

It comes as M&S revealed total sales in its hard-hit clothing and home arm plunged 29.9% in the eight weeks since shops reopened, with store sales tumbling 47.9% and online sales surging 39.2%.

It said sales declines were improving but that it was “clear that there has been a material shift in trade”.

“Whilst it is too early to predict with precision where a new post-COVID sales mix will settle, we must act now to reflect this change,” it said.

The group said the pandemic had shown staff can work “more flexibly and productively” and are able to multi-task and move between food, clothing and home departments.

CEO Steve Rowe said: “In May we outlined our plans to learn from the crisis, accelerate our transformation and deliver a stronger, more agile business in a world in which some customer habits were changed forever.

"Three months on and our Never the Same Again programme is progressing; albeit the outlook is uncertain and we remain cautious. As part of our Never The Same Again programme to embed the positive changes in ways of working through the crisis, we are today announcing proposals to further streamline store operations and management structures.

"These proposals are an important step in becoming a leaner, faster business set up to serve changing customer needs and we are committed to supporting colleagues through this time.”

The group has performed ahead of its scenario planning announced at year end in both revenue and cash.

Its latest trading update showed a mixed performance across stores, with those in newer out-of-town locations almost back to pre-Covid sales levels, but town centre shops and some shopping centres still “heavily impacted” by social distancing.

While clothing and home sales remained steeply lower, it said food sales rose 2.5% in the 13 weeks to August 20 and also 2.5% higher in the 8 weeks since stores reopened.