July 28 - Employment in the retail sector fell in the second quarter compared to last year, the British Retail Consortium and business law firm Bond Pearce said on Thursday, and weakening sentiment among retailers pointed to further job losses.

Retailers are suffering from consumers' reluctance to spend as rising prices, higher taxes and slow wage increases hit their budgets. - photo: corbis

The number of employees in the retail sector fell by 0.4 percent compared to the second quarter of last year and was down 0.7 percent in June, the BRC said.

Staff numbers were below the year-ago level for three consecutive months for the first time since the BRC launched its employment survey in October 2008, the industry body said.

Food retailers bucked the trend by hiring more staff and reporting a positive attitude towards future employment, the survey showed.

"The split reflects the very different fortunes of retailers selling food - a must-have for customers - and those servicing discretionary and big ticket spending," said Stephen Robertson, director general of the British Retail Consortium.

A quarter of retailers in the sample, which represents over a million employees, said they intended to cut more jobs, compared with just 8 percent of retail companies this time last year. "The results indicate a continued weakening in sentiment," The BRC said.

Retailers are suffering from consumers' reluctance to spend as rising prices, higher taxes and slow wage increases hit their budgets.

A number of UK retailers have fallen into administration over recent months, including familiar high street brands such as women's fashion chain Jane Norman, wine chain Oddbins and home improvements group Focus DIY.

Despite the fall in overall employment, June recorded the lowest proportion of redundancies since the monitor first began in October 2008, providing a glimmer of hope.

"Retailers are still weathering a significant storm and, while their confidence in terms of growth may have been tempered, the downward trend in redundancy figures shows a resilience and commitment to make it out the other side," said Christina Tolvas-Vincent, head of retail employment at Bond Pearce.

(Created by Clare Kane)