Corporations begin cautious return to UK offices after lockdown
When British holidaymakers return from the beaches and a truncated holiday season, some companies will be preparing to welcome back workers too.
After months of Zoom video calls, a number of major businesses are getting ready for a return to (relative) normality. Last week accountancy firm PwC reopened all of its UK offices, while its competitor Deloitte began to allow staff back to some sites in the capital and other regional cities, and employees of law firm Slaughter and May were once again able to opt to work from its London headquarters.
The coronavirus lockdown has prompted some of the UK’s most prominent companies to announce large-scale job losses. The aviation, automotive and retail sectors have been among the worst hit, as businesses adjust to dramatically reduced revenue projections.
While the government’s job retention scheme has so far protected millions of jobs, fears are mounting that unemployment will rise as the scheme begins to be phased out from August.
Since lockdown began on 23 March, some of the UK’s largest companies have announced plans to cut a total of 60,000 jobs globally, many of which will fall in the UK.
Rolls-Royce - 9,000 jobs
The jet-engine manufacturer has confirmed that 3,000 job cuts, of a planned 9,000 worldwide, will be made in the UK. In May Rolls-Royce said it would make the first round of redundancies through a voluntary programme, with about 1,500 posts being lost at its headquarters in Derby, as well as 700 redundancies in Inchinnan, near Glasgow, another 200 at its Barnoldswick site in Lancashire, and 175 in Solihull, Warwickshire.
BP- 10,000 jobs
The oil company said in June it plans to make 10,000 people redundant worldwide, including an estimated 2,000 in the UK, by the end of the year. The BP chief executive, Bernard Looney, said that the majority of people affected would be those in office-based jobs, including at the most senior levels. BP said it would reduce the number of group leaders by a third, and protect the “frontline” of the company, in its operations.
Centrica- 5,000 jobs
The owner of British Gas announced in June that it intends to cut 5,000 jobs, mostly senior roles, and remove three layers of management, in a bid to simplify the structure of its business. The energy firm has a total workforce of 27,000, of whom 20,000 are in the UK.
Bentley- 1,000 jobs
The luxury carmaker intends to shrink its workforce by almost a quarter, slashing 1,000 roles through a voluntary redundancy scheme. The majority of Bentley’s 4,200 workers are based in Crewe in Cheshire.
Aston Martin Lagonda – 500 jobs
The Warwickshire-based luxury car manufacturer has announced 500 redundancies.
British Airways - 12,000 jobs
The UK flag carrier is holding consultations to make up to 12,000 of its staff redundant, a reduction of one in four jobs at the airline. BA intends to cut roles among its cabin crew, pilots and ground staff, while significantly reducing its operations at Gatwick airport.
Virgin Atlantic - 3,000-plus jobs
Richard Branson’s airline is to cut more than 3,000 jobs, more than a third of its workforce, and will shut its operations at Gatwick.
EasyJet – 4,500 jobs
The airline has announced plans to cut 4,500 employees, or 30% of its workforce.
Ryanair – 3,000 jobs
The Irish airline intends to slash 3,000 roles and reduce staff pay by up to a fifth.
Aer Lingus – 900 jobs
The Irish airline, part of International Airlines Group (IAG) plans to cut 900 jobs.
P&O Ferries – 1,100 jobs
The shipping firm intends to cut more than a quarter of its workforce, a loss of 1,100 jobs. The company, which operates passenger ferries between Dover and Calais, and across the Irish Sea, as well as Hull to Rotterdam and Zeebrugge, will initially offer employees voluntary redundancy.
JCB – 950 jobs
Digger maker JCB said in May up to 950 jobs are at risk after demand for its machines halved due to the coronavirus shutdown.
Ovo Energy – 2,600 jobs
Britain’s second biggest energy supplier announced in May it planned to cut 2,600 jobs and close offices after the lockdown saw more of its customer service move online.
Johnson Matthey – 2,500 jobs
The chemicals company said in June it is planning to make 2,500 redundancies worldwide over the next three years. The move will affect 17% of the workforce at the firm, which is a major supplier of material for catalytic converters.
Bombardier – 600 jobs
The Canadian plane maker will cut 600 jobs in Northern Ireland, as part of 2,500 redundancies announced in June.
The Restaurant Group – 1,500 jobs
The owner of Tex-Mex dining chain Chiquito, and other brands including Wagamama and Frankie & Benny’s, said in March that most branches of Chiquito and all 11 of its Food & Fuel pubs would not reopen after the lockdown, leading to the loss of 1,500 jobs.
Monsoon Accessorize – 345 jobs
The fashion brands were bought out of administration by their founder, Peter Simon, in June, in a deal which saw 35 stores close permanently and led to the loss of 545 jobs.
Clarks – 900 jobs
Clarks plans to cut 900 office jobs worldwide as part of a wider turnaround strategy
Oasis and Warehouse – 1,800 jobs
The fashion brands were bought out of administration by restructuring firm Hilco in April, in a deal which led to the permanently closure of all of their stores and the loss of more than 1,800 jobs.
Debenhams – 4,000 jobs
At least 4,000 jobs will be lost at Debenhams as a result of restructuring, following its collapse into administration in April, for the second time in a year.
Mulberry – 470 jobs
The luxury fashion and accessories brand said in June it is to cut 25% of its global workforce and has started a consultation with the 470 staff at risk.
Jaguar Land Rover – 3,300 jobs
The car firm is to cut 1,100 contract workers at manufacturing plants the UK, potentially affecting factories at Halewood on Merseyside and Solihull and Castle Bromwich in the West Midlands. Logistics giant DHL has also notified unions that 2,200 workers, around 40% of those currently employed on its JLR contract, will be laid off.
Travis Perkins – 2,500 jobs
The builders’ merchant is cutting 2,500 jobs in the UK, accounting for almost a 10th of its 30,000-strong workforce. The company, which is behind DIY retailer Wickes and Toolstation, said the job losses will affect staff in areas including distribution, administrative roles and sales. The move will also affect staff across 165 stores that are now earmarked for closure.
Swissport – 4,500 jobs
Swissport, which handles services such as passenger baggage and cargo for airlines has began a consultation process that is expected to result in 4,556 workers being made redundant, more than half of its 8,500 UK workforce.
Royal Mail - 2,000 jobs
Royal Mail has announced a cost-cutting plan that will involve slashing about 2,000 jobs. One in five of its near-10,000 management roles will go by March 2021, in areas including IT, finance, marketing and sales. The company’s 90,000 postal workers would not be affected by the cuts.
SSP Group – 5,000 jobs
The owner of Upper Crust and Caffè Ritazza is to axe 5,000 jobs, which represents about half of its workforce. The cuts will have an impact on staff at its head office and across its UK operations. It follows a dramatic fall in domestic and international travel, which has hit the company’s sites based at railway stations and airports.
Accenture – 900 jobs
The consultancy firm is reduces costs in the face of lower demand for its services. The New York-listed company employs 11,000 people in offices across the UK including in Aberdeen, London and Cambridge. The UK job cuts will be at all levels, including managing directors, and across all parts of the business.
Harrods – 700 jobs
The department store group is cutting one in seven of its 4,800 employees due to the “ongoing impacts” of the pandemic. The Harrods chief executive, Michael Ward, blamed the cuts on social distancing and a lack of tourists.
Airbus – 1,700 jobs
The European planemaker announced plans this week to cut 1,700 jobs in the UK as it warned the coronavirus pandemic had triggered the “gravest crisis” in its history.
Accenture – up to 900 jobs
Accenture is to cut up to 900 jobs in the UK as the consultancy firm reduces costs in the face of lower demand for its services. The New York-listed company employs 11,000 people in offices across the UK including in Aberdeen, London and Cambridge. The UK job cuts will be at all levels, including managing directors, and across all parts of the business.
Boots - 4,000 jobs
Boots is cutting 4,000 jobs – or 7% of its workforce – by closing 48 opticians outlets and reducing staff at its head office in Nottingham as well as some management and customer service roles in stores.
John Lewis – 1,300 jobs
John Lewis announced that it is planning to permanently close eight of its 50 stores, including full department stores in Birmingham and Watford, with the likely loss of 1,300 jobs.
PwC is targeting the end of September for the return of more than 50% of its employees.
“Bringing people together safely is important for teams, good for communities and good for the economy. There is also a mental health benefit for many,” said its chairman, Kevin Ellis. “I see value in people being back in the office.”
However, many other big office occupiers are in no great rush to return to their corporate headquarters, many of which are in central London, as well as cities including Birmingham, Manchester and Glasgow.
Remote working during lockdown has generally been judged a success by the largest banks, accountancy and law firms. As a consequence they aren’t eager to force their staff back on to public transport to reach their desks, which is a particular preoccupation for those based in central London.
The 30 biggest employers in the capital’s financial district, the City of London, only intend to bring between 20% and 40% of workers back to their offices in the coming months, according to the City of London police commissioner, Ian Dyson, with the rest continuing to work remotely.
The tentative return to city centres will have an impact on other sectors of the economy, from transport companies to the smaller businesses that provide services to thousands of office workers.
International employers with a presence in Asia, such as US bank Goldman Sachs and law firm Freshfields, with buildings in London and Manchester, have learned from their experience in the region, which was affected by the coronavirus pandemic earlier than Britain.
Goldman Sachs has allowed staff to voluntarily return to its London headquarters since mid-June and it’s thought that about 10% of the 6,000 workforce has chosen to do so.
When workers reprise the commute and enter their corporate building for the first time in months, many things will feel unfamiliar.
Temperature checks on entry, one-way systems inside the building, limits on how many people can travel in a lift, and wearing of masks in communal areas have all made their mark on the corporate environment.
Some firms are thought to be considering whether to offer antibody testing to their staff, although the accuracy of some tests is disputed.
Many physical safety measures can be more easily introduced by companies who are the sole occupier of their building, as they can control the environment and better manage the wellbeing of their workforce.
Property consultant Tony Lorenz has seen demand for “self-contained buildings” come back into fashion among his clients.
Related: Why the home-working boom could tumble London's skyscrapers
Firms based in skyscrapers may also find the transition back to work more challenging, if only a small number of people are permitted to ride together in a lift.
The chief executive of Barclays, Jes Staley, which occupies a 33-storey high-rise in east London’s Canary Wharf district, said in April “the notion of putting 7,000 people in a building may be a thing of the past”.
The main focus for businesses is “the ability to provide a safe office environment for staff, as well as staff concerns around using public transport,” according to Miles Celic, chief executive of financial lobby group TheCityUK.
“While localised outbreaks remain a possibility, many firms will either take a slow and phased approach to returning to the office or continue to take a wait-and-see approach for the foreseeable future,” Celic added.
How workers travel to the office is a major consideration for London-based firms, where the vast majority of workers are used to cramming into trains and buses during their daily commute, and not all can choose to drive, walk or cycle instead.
For one financial firm in Canary Wharf, where in regular times thousands of people pour from the underground station to gleaming towers during a couple of hours each morning and evening, staggering start and finish times for employees will not make much difference.
Many corporations believe the stigma of remote working has disappeared during the pandemic, and some expect companies to retain working from home for some of the time.
Over the coming months, businesses are expected to reconsider whether they still require the same amount of expensive office space as they did before Covid-19.
Even as lockdown restrictions ease, city centre streets that once thronged with busy workers remain empty, hurting the small service businesses who rely on footfall to drive trade, including sandwich shops, coffee carts and dry cleaners.
“It’s not going too well,” said Aida Xhameni, who runs Alfredo’s sandwich shop, just a few streets from the Bank of England, with her husband.
Trade hasn’t picked up in the month since Alfredo’s reopened, and is the worst Xhameni has seen in 15 years of business. “We’re making about a quarter of what we did before,” she said.
For Alfredo’s and many other small businesses, a return to office working can’t come soon enough, although they may be waiting some time.
