Tesco’s 16,000 jobs drive to reward lockdown temps

Tesco’s 16,000 jobs drive to reward lockdown temps


Tesco worker

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Tesco will create 16,000 new permanent jobs after lockdown led to “exceptional growth” in its online business.

The new posts will include 10,000 staff to pick customer orders from shelves and 3,000 delivery drivers.

The recruitment drive reflects the shift to online shopping, which was accelerated by lockdown.

Tesco said it expected many of the roles to go to staff who joined them on a temporary basis at the start of the pandemic.

Supermarkets scrambled to meet a surge in demand for online deliveries while the UK was in lockdown.

Tesco said online customer numbers had risen from around 600,000 at the start of the pandemic, to nearly 1.5 million.

Before the pandemic, around 9% of Tesco’s sales were online. Now, online sales amount to 16% of sales, and are expected to be worth over £5.5bn this year, the company said.

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Online grocery orders now make up 16% of Tesco’s sales

“The crisis has seen a dramatic increase in the size of the online grocery market in the UK,” said Clive Black, retail analyst at Shore Capital.

“It does not look like, and Tesco UK does not seem to think, it is going to revert back to the pre-coronavirus levels.”

Tesco UK & Ireland’s chief executive Jason Tarry said: “These new roles will help us continue to meet online demand for the long term.”

Tesco’s announcement may sound like welcome relief from the somewhat ominous drip-drip of job cut announcements from retailers, but its real significance is to underline the shift in shopping habits from bricks-and-mortar retailing to online.

That shift benefits those with a big online presence, at the cost of the old-fashioned shops that don’t.

It was already underway before the coronavirus crisis, threatening the viability of small independent retailers and defacing High Streets with boarded up shopfronts and ‘To Let’ signs. With lockdown, the shift accelerated dramatically, as even the remaining users of the High Street were forced to go online.

At first, online retailers like Tesco hedged their bets to meet the surge in demand for online delivery, hiring thousands of workers on temporary contracts.

However, now they’re offering them permanent jobs it’s clear that Tesco’s executives believe much of the shift to online during the pandemic will be permanent.

Growth in the online grocery market will have made the sector more profitable, points out Mr Black.

“As the market expands, economies of scale start to come into play,” he said.

There is no need to offer money-off coupons or free delivery to attract new customers in the current climate, he added.

Mr Black emphasised that the efficiency of deliveries is improved because drivers can serve customers who are closer together, and supermarkets can better use of systems, staff and equipment: “You put all those things together and the industry goes from marginally loss-making to marginally profitable.”

In addition, discount retailers like Aldi and Lidl, which were eating into the big grocers’ market share, don’t have online services and can’t compete in that market.

Tesco has already created 4,000 new permanent roles since March. The new roles are permanent and a mixture of full and part-time.

The expansion is in contrast to other parts of the retail sector, where High Street companies have been forced to make steep job cuts following lockdown.

Most recently, Marks & Spencer said it would axe 7,000 jobs over three months, while Debenhams said it plans to cut a further 2,500 roles.


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