brexit

Retail leaders are feeling far more downbeat about the future since the vote for Brexit, according to a new survey of 50 leading chair people

The Korn Ferry survey, which interviewed bosses at many of the UK’s biggest retail companies, found 40% were pessimistic compared with only 27% when a similar survey was carried out in 2016 before the referendum.

Only 24% of respondents expressed general optimism about the economic outlook for the next 12 months, compared with 27% last year.

Morrisons chairman Andy Higginson spoke openly about his concern, warning of a rise in inflation and unemployment.

“I’m slightly pessimistic about the year ahead,” he said. “We will see inflation coming in and there could be a slowdown in job creation, which may lead to a slight upswing in unemployment.”

Higginson also spoke about the unfair playing field between bricks & mortar retailers and online companies, with 36% of chair people describing Amazon as a “serious threat”.

He said: “They always say competition is the best regulator, but the so-called gig economy is exploiting the system without offering the same employment conditions as those in traditional retail.”

Lord Stuart Rose, chairman of Ocado, also warned of the impact of inflation.

“I am an optimist by nature but am certainly more pessimistic than a year ago. We don’t actually know what is going to happen. Not only is there cost inflation, but the further concern around the availability of properly trained labour.”

However Tesco chairman John Allan said the result of Brexit could go either way, and might benefit retailers.

“I’m both optimistic and pessimistic,” he said. “The economy is quite unpredictable because politics is unpredictable. I don’t believe in the Armageddon scenario - if the politicians do the Brexit negotiations fairly well then the economy could do OK.”

Phil Wrigley, chairman of Majestic Wines and Hobbs, described himself as “cautiously optimistic” about the year ahead. “I think that people need to see the reality of economic challenge and the threat to them personally before they react with altering their spending habits,” he added.

There was more certainty when it came to bosses’ predictions for the result of the election, with 92% predicting the Tories would win.

And despite growing pessimism, bosses were more upbeat when it came to talking about their own companies, with 72% believing their own firms would grow over the next 12 months, up from 70% in 2016.

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