UK retail employment has fallen to a record low, with 2.78 million jobs in the year to the second quarter of 2026 as rising employment costs continue to put pressure on the sector.
The latest Office for National Statistics (ONS) figures show the four-quarter average for retail jobs fell by 62,000 year-on-year, 122,000 over the past two years and 410,000 over the past decade.
The latest figure is down from the 2.79 million four-quarter average recorded in the first quarter of 2026, which was previously reported as the lowest on record.
Of the 2.78 million retail jobs recorded in the latest period, 1.29 million were full-time and 1.50 million were part-time. Part-time employment has now fallen to its lowest level on record.
Retail remains the UK’s largest private-sector employer, ahead of hospitality at 2.62 million jobs and manufacturing at 2.35 million.
The British Retail Consortium (BRC) said the decline comes as retailers face a £6.5bn increase in employment costs over the past two years.
Changes to employer National Insurance contributions announced in the 2024 Budget and introduced in April 2025 added £2.3bn to retailers’ costs, while two consecutive above-inflation increases to the National Living Wage have further increased employment costs.
Helen Dickinson, Chief Executive of the BRC, said: “Entry-level retail jobs are vanishing at the very moment they are needed most.”
She added that the loss of 122,000 retail jobs over the past two years meant “tens of thousands fewer opportunities for young people to get their first step on the career ladder”.
The BRC has called on the Government to raise the National Insurance threshold to £6,000, which it said would help retailers invest and hire.
The figures come as retailers and the Government work to create more routes into employment for young people. More than 40 retailers have pledged 11,305 work experience placements through the BRC’s Opening Shift initiative, with the wider programme targeting 100,000 youth job opportunities by 2029.
Retail and its supply chain account for close to a quarter of UK youth employment, according to the BRC, making the decline in entry-level and part-time roles a particular concern as youth unemployment remains high.
The latest retail figures follow wider signs of weakness in the UK labour market. ONS data showed payrolled employees fell by 26,000 in August to 30.2 million, following a 19,000 decline in July.
ONS Director of Economic Statistics Liz McKeown said payrolled employee numbers had continued to fall, with declines over the past year particularly evident in the retail and hospitality sectors. She added that smaller businesses continued to report that increased labour costs were affecting their hiring decisions.