Sainsbury's to cut 2,000 jobs despite rise in sales

'This has been a difficult decision and we appreciate that this will be a tough time for those colleagues affected by the changes'

Central office functions among those facing change (Getty)

J Sainsbury is looking to cut around 2,000 payroll and human resources jobs across the business as it continues a cost-cutting drive meant to slash £500m over the next three years.

The company confirmed on Tuesday that it had launched a consultation on plans to remove HR and payroll roles from its stores, which is expected to affect around 1,400 staff.

It will also restructure its central office operations by consolidating HR and additional support staff from across the grocery chain, Argos and Sainsbury’s Bank, which could see another 600 roles axed.

The announcement comes amid a major cost-cutting programme that has seen Sainsbury’s commit to slashing £150m of costs this year and £500m in the following three years.

A spokesman for Sainsbury’s said: “The UK grocery market is changing at a rapid pace and it’s crucial that we transform the way we operate to meet future challenges and continue to provide customers with best in class service.

“Following a comprehensive review, we are proposing some updates to our HR structures and systems, as well as changes to a number of other support roles, subject to consultation.

“This has been a difficult decision and we appreciate that this will be a tough time for those colleagues affected by the changes.

“We will support them in any way we can.”

J Sainsbury – which employs around 195,000 staff across the UK – is not the only grocer to reveal central job cuts in recent months.

In August, Asda confirmed it had axed nearly 300 jobs at its head office as part of its own cost-cutting drive, while a further 800 staff had the scope of their job descriptions changed as part of a shake-up.

The job cuts accounted for more than a tenth of Asda’s 2,500 head office roles.

J Sainsbury recently notched up its best supermarket sales for years, raising hopes of rising profits.

The company said in July that like-for-like retail sales including the recently bought Argos chain rose 2.3 per cent in its first quarter.

Sales were boosted by rising inflation, as well as the later timing of Easter and Mother’s Day, but the group said it also rung up a 1.9 per cent rise in the number of transactions at its tills.

The sales hike was a marked bounceback from 0.3 per cent growth the previous quarter as Sainsbury’s cheered a rebound in total grocery sales, which leapt three per cent higher.

This offset a slowdown in general merchandise sales – including Argos – to one per cent from 1.5 per cent the previous quarter amid an overhaul following last year’s £1.4bn takeover of Home Retail Group.

Press Association