Supermarkets 'creating jobs' WTF?
Discussion
In the news again, this time it's Asda creating 5,000 jobs.
http://www.bbc.co.uk/news/business-16676688
But I thought that the whole point of owning supermarkets was to keep the cost of purveying a set amount of food etc right down, in part by employing less staff than would be necessary to retail that much product through other outlets. Now, if that's true, then how does opening supermarkets create jobs? Is the fact that there is now a supermarket in an area mean that the customers in that area are going to consume more (and if so, where is that money going to come from)? Or that fresh money is going to come in from outside the area to pay for more product?
My guess is that those 5,000 jobs are going to be created at the expense other jobs in the areas concerned, when the existing retail outlets close as a result of the new competiton. I'm not in any way saying such competition is a bad thing, I'm just calling bulls
t on the job creation claim.
http://www.bbc.co.uk/news/business-16676688
But I thought that the whole point of owning supermarkets was to keep the cost of purveying a set amount of food etc right down, in part by employing less staff than would be necessary to retail that much product through other outlets. Now, if that's true, then how does opening supermarkets create jobs? Is the fact that there is now a supermarket in an area mean that the customers in that area are going to consume more (and if so, where is that money going to come from)? Or that fresh money is going to come in from outside the area to pay for more product?
My guess is that those 5,000 jobs are going to be created at the expense other jobs in the areas concerned, when the existing retail outlets close as a result of the new competiton. I'm not in any way saying such competition is a bad thing, I'm just calling bulls
t on the job creation claim.SC does have a valid point here. The additional demand from growth of an area is already being met someway or another.
So it could be said that Asda is not actually creating more jobs it is actually stifling growth of other businesses in the area that have already taken up that demand and could actually be costing jobs if it is a more efficient means of servicing the demand.
So it could be said that Asda is not actually creating more jobs it is actually stifling growth of other businesses in the area that have already taken up that demand and could actually be costing jobs if it is a more efficient means of servicing the demand.
The supermarket in isolation creates jobs.
The addition of a supermarket to an area that doesn't have one kills more jobs in other businesses than it creates in itself, due to its greater efficiency.
Shoppers benefit in terms of price and convenience, but the area suffers in terms of employment and town centre vitality.
The addition of a supermarket to an area that doesn't have one kills more jobs in other businesses than it creates in itself, due to its greater efficiency.
Shoppers benefit in terms of price and convenience, but the area suffers in terms of employment and town centre vitality.
fido said:
It's neither good or bad news. A large propoertion of people (but not all) who shop in ASDA are horrid beings, and i guess the increase in number of outlets will correspond with an increase in the number of these horrid beings - coming to a town near you.
Have you fully considered cause and effect here?
The net effect on the economy and unemployment is unknowable. Maybe shoppers spend the money saved on labour intensive services (childcare, hookers) or maybe they spend it on low-labour goods (electronics ordered on the internet).
But what else can you say in a press release/news article?
But what else can you say in a press release/news article?
eharding said:
So, if Asda announced 5000 redundancies, presumably that would be cause for celebration?
Well, if those redundancies were caused by them closing supermarkets, I imagine there would be much rejoicing in those areas amongst the businesses that were best placed to supply the demand created, and if those businesses were less efficient, then quite possibly more than 5,000 jobs would be created.singlecoil said:
Well, if those redundancies were caused by them closing supermarkets, I imagine there would be much rejoicing in those areas amongst the businesses that were best placed to supply the demand created, and if those businesses were less efficient, then quite possibly more than 5,000 jobs would be created.
Indeed. If they were closing because of increased competition from Waitrose, that might be cause for celebration but that is not a probable scenario. I was fortunate enough to witness the opening of a new ASDA in Kingston Vale many years ago. Admitedly it has brought a much needed amenity to the area and on reflection this has been a good thing, along with the improved transport links to support said supermarket. Then again i have to mingle with the wretched specimens who roll out from the buses at regular intervals.
singlecoil said:
eharding said:
So, if Asda announced 5000 redundancies, presumably that would be cause for celebration?
Well, if those redundancies were caused by them closing supermarkets, I imagine there would be much rejoicing in those areas amongst the businesses that were best placed to supply the demand created, and if those businesses were less efficient, then quite possibly more than 5,000 jobs would be created.You're not French are you?
eharding said:
So, you're arguing that we can reduce unemployment by making businesses less efficient?
There's really only one point to my argument on this thread, and that is that Asda (or whichever supermarket it is that happens to announce an expansion) is not creating jobs, it's actually reducing the overall number of jobs in the area concerned.Now I'm not saying that that's a bad thing, just that the press releases are b
ks.A decade ago if I wanted to buy a CD I had the choice of seven town centre stores to buy from, varying from independents to nationals. Now there is one -HMV. The supermarkets have all now started to sell CDs but is this as a result of the failed business models of the music stores or did the supermarkets force out the specialists? One thing I have noticed is the supermarkets do not have anywhere near the selection that the indies did, nor do they offer the service that the specialists did; for example try to order an old album from an artist's back catalogue in ASDA, they'll have no clue! The same is happening with clothing stores and gift shops, generally of the naff/ cheap variety, such as Past Times and Peacocks. TU And George are the new budget brands and the supermarkets are edging into the tech and toy sectors too. One thing I've noticed is that ASDA have occasional offers on baby products where they sell equipment at low prices, presumably having bought a one off bulk batch. I bought a nappy disposal tub with a pack of liner cartridges. When these cartridges ran out I returned for more to be told they are only stocked when they have these occasional sales and they cannot say when the next one will be. Service?!!! Bad form.
I was reading an article on the many closures and buyouts in the retail sector at the moment and one store in Perth was said to employ 7 staff. In my town's shopping centre there are three cheap ladies clothing stores in a row which have closed or are closing. Would the town's supermarkets be likely to provide 21 new jobs in their clothing departments?
To summarise I'd say I doubt the supermarkets are going to replace, like for like, the number of jobs lost in sectors they are expanding into and I'd say the supermarkets will not provide the variety the high street offered nor do I think they will offer the service to the customer in these areas or the training and job satisfaction that the high street once provided for employees. Once the supply chain that catered for indies is dismantled it will also be more difficult for staff to start their own new small businesses. Supermarkets have been the architects of this but failing retailers have also dug their own holes by forgetting about service, training and real value.
I was reading an article on the many closures and buyouts in the retail sector at the moment and one store in Perth was said to employ 7 staff. In my town's shopping centre there are three cheap ladies clothing stores in a row which have closed or are closing. Would the town's supermarkets be likely to provide 21 new jobs in their clothing departments?
To summarise I'd say I doubt the supermarkets are going to replace, like for like, the number of jobs lost in sectors they are expanding into and I'd say the supermarkets will not provide the variety the high street offered nor do I think they will offer the service to the customer in these areas or the training and job satisfaction that the high street once provided for employees. Once the supply chain that catered for indies is dismantled it will also be more difficult for staff to start their own new small businesses. Supermarkets have been the architects of this but failing retailers have also dug their own holes by forgetting about service, training and real value.
Surely this is the essential nature of capitalism and market efficiency.
Strong , efficient organisation displacing weak ineffective or higher cost business models.
The response of independent stores located nearby, SHOULD be to offer a higher quality of service, better or more exclusive products or in some way differentiate themselves. Or go head to head with Asda and let the public decide where they want to shop.
This is kind of like being annoyed that Steam Engines caused massive unemployment amongst canal diggers. No?
Strong , efficient organisation displacing weak ineffective or higher cost business models.
The response of independent stores located nearby, SHOULD be to offer a higher quality of service, better or more exclusive products or in some way differentiate themselves. Or go head to head with Asda and let the public decide where they want to shop.
This is kind of like being annoyed that Steam Engines caused massive unemployment amongst canal diggers. No?
I can see the OP's point, ASDA former parent company Wal Mart was well known in the US for moving into an area, creating 100's of new minimum wage, zero benefits jobs at the same time as destroying the local economy and ending many more higher paid jobs.
The locals would usually be up-in-arms about it, but still flocked to mega store to save money.
But the UK economy is already well developed / ruined depending on your point of view. Small independent businesses are few and far between in the retail sector. A new ASDA usually means your local Tesco / Sainsbury's / Aldi will be a little quieter on a Saturday afternoon.
As someone mentioned in another thread once, the way the supermarkets report their performance to year-end investors is all about market share and total item sales, rather than profit margins so we can expect all of the big players to continue to open new stores and extend current ones as fast as possible for the foreseeable future.
The locals would usually be up-in-arms about it, but still flocked to mega store to save money.
But the UK economy is already well developed / ruined depending on your point of view. Small independent businesses are few and far between in the retail sector. A new ASDA usually means your local Tesco / Sainsbury's / Aldi will be a little quieter on a Saturday afternoon.
As someone mentioned in another thread once, the way the supermarkets report their performance to year-end investors is all about market share and total item sales, rather than profit margins so we can expect all of the big players to continue to open new stores and extend current ones as fast as possible for the foreseeable future.
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