The release of the UK Labour Party’s 2024 general election manifesto has prompted mixed reactions in the retail sector.
Oliver Maddison, a retail analyst at leading data and analytics company GlobalData, offered his insights, suggesting that retailers should not anticipate immediate benefits from the potential Starmer-led government.
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The Labour manifesto, while containing several retail-relevant policies, lacks clear timelines for most initiatives, except for some immediate labour market reforms.
“Of the retail-relevant policies set out in the Labour manifesto on Thursday, the only one with a prescribed timeframe was a package of labour market reforms to be delivered in the first 100 days, slightly increasing labour costs, with the remainder having no set timeline or unlikely to have a significant effect until later in the [country’s] parliament,” said Maddison.
This package includes a ban on zero-hour contracts and ‘fire-and-rehire’ practices, the elimination of qualifying time for rights such as sick pay, parental leave, and flexible working, and the strengthening of both trade unions and state enforcement.
“Combined with the proposed removal of age banding for the minimum wage, retailers are likely to see slightly higher labour costs in the not-too-distant future, which may disincentivise job growth in the sector, although there is additional uncertainty as to whether removing minimum wage age banding would apply to under-18s,” highlighted Maddison.
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By GlobalDataDespite these initial challenges, Maddison believes that retail executives should be encouraged by Labour’s overall policy package.
However, many of the party’s anticipated reforms lack specific timelines, suggesting a gradual implementation.
“The manifesto promises non-specific structural reforms to business rates, indicating that the policy detail is likely to be thrashed out once Labour enters government, backloading the implementation timeline,” said Maddison.
Similarly, the commitment to reform the current apprenticeship levy into a ‘Growth and Skills Levy’ is mentioned without a concrete timeline, indicating that retailers may have opportunities to influence policy outcomes through consultations with policymakers.
According to Maddison, planning reform, highlighted as a key priority for Starmer, will be central to future growth, “but concrete effects will likely take time to come to fruition.”
While Labour has pledged to crack down on shoplifting and introduce a specific offence for assaulting retail staff, these measures are largely symbolic.
The broader efforts to reduce crime and clear court backlogs will be more significant determinants of success.
While the Labour manifesto outlines several significant policy shifts, the UK’s retail sector should prepare for gradual changes rather than immediate boosts.
