England, Wales and Scotland section of International Socialist Alternative

Wilko collapses: Socialist measures needed to save jobs and fight poverty

By Jack Yarlett, Socialist Alternative Merseyside

High street retailer Wilko has gone into administration. Most of its 400 stores are expected to close, and the vast majority of its 12,500 workers will expect to be made unemployed. This marks the culmination of years of underinvestment by Wilko’s owners. The Guardian reports that in an attempt to stem financial losses Wilko “cut jobs, rejigged its leadership team, and sold off a distribution centre.” Shops became understocked and shelves were left empty as payments to suppliers were not met.  

Business ‘experts’ have put all this down to Wilko’s failure to adapt to market changes and to competition from other similar businesses. This is a euphemism that dodges the ineptitude and greed of those responsible.

While the chain crumbled, the owners and shareholders received dividends worth millions – up to £77 million over the previous decade – syphoning off money that could have been spent investing and stabilising the business to protect jobs. They will be flying high while thousands will be left to try and find new jobs, with company pension schemes depleted of millions. Meanwhile, high streets in working class areas will increasingly fill up with even more empty shop fronts. 

This is not just a news story about one business. It is a reflection of the crisis facing British capitalism as a whole. The asset-stripping behaviour of the company’s owners is endemic among retail giants, whose owners and investors choose quick cash over real investment. Many other businesses, large and small, will be vulnerable to both the effects of the cost-of-living crisis and repeated hikes in interest rates.

Shoplifting ‘crisis’ shows the system at its most brutal

Another phenomenon has recently caused the capitalists and Tories to ring panic bells: shoplifting. ONS figures from April this year say that shoplifting is up 23%. Bosses are up in arms. One managing director at The Co-operative Group said thefts were “out of control”. The boss of John Lewis, Sharon White, recently complained that thieves have a “licence to shoplift.” Waitrose has offered free coffee to police officers in exchange for more protection from shoplifters.

“This is a frightening state of affairs. It affects us all. It will destroy high streets and put prices up even further” thunders a statement from TM Eye Ltd. – a private detective and prosecution company headed by a former Met police detective that specialises in bringing private prosecutions against suspected shoplifters on behalf of the biggest retail names. 

Hiring private companies to haul the poorest, most vulnerable, and the most desperate before judges to face potential prison sentences is not the only response at the disposal of big retail businesses. Some companies are now investing in new surveillance technologies such as facial recognition software, or surveillance systems with AI-based behavioural analytics. 

The Tory government is keen to step in and turn this into yet another culture war issue, attempting to turn this into one more way to whip up anger and reaction, justifying more repressive police powers. Responding to a recent alleged incident where a large group of mainly black youth supposedly attempted to steal from shops on London’s Oxford Road, Suella Braverman called for those involved to be “hunted down and locked up”, relying on both coded and blatant racist rhetoric.  

The right-wing press is, of course, adamant that rising poverty is not to blame, that theft is on the rise because the state is not powerful enough to punish adequate numbers of shoplifters with the severity needed.

Needless to say, the correlation between the soaring cost of living, along with more than a decade of Tory austerity, with an increase in the number of people stealing is self-evident. Even cases where items are stolen to be sold to others (things like cosmetics, alcohol, clothes, and so on) are no less a reflection of a spike in the number of people desperate for some extra cash in order to survive. 

While the Tories and the bosses will take punitive measures against shoplifters, and pass the costs on to the workers only in order to protect their fat profit margins, we should not forget that this is a workplace issue as well. Usdaw, the retail workers union, reported recently that up to three-quarters of retail workers have faced violence, threats, or abuse. And a third of these incidents were linked to shoplifting. 

Low-paid retail workers should not have to deal with workplaces where their safety is at risk. Nor should anyone have to face more surveillance, more profiling, and more police harassment that will undoubtedly fall hardest on the poorest workers, the young, and people of colour. 

Socialist solution

Inevitably, with the economic turmoil showing no sign of disappearing, there will be other business failures like that of Wilko. Many more retail giants will attempt to carry out job cuts and closures, as both inflation and stagnant wages cut deeper into working class people’s ability to spend. Small businesses will be hit the hardest. So where is the solution? 

Price controls on essentials, real-term pay increases for workers, nationalisation of energy and utility companies to bring bills down to affordable levels, and nationalisation of companies at risk of closure would all be a start. But there’s no chance of measures like these being taken by either the Tories or by Starmer’s Labour to the level needed should they come to power in 2024. 

We have seen time and time again that the measures workers need to save jobs and fight the cost of living crisis will only be carried out if we organise to fight for it. Unions now must mobilise their resources to recruit and organise all those workers who run the risk of being out of work during the ongoing economic crisis. Well organised, fighting unions, prepared to strike must be built urgently to prepare a fight back in the case of further collapses. The strike wave of hundreds of thousands of workers over the past 12 months shows the beginnings of an example of what is possible. 

With a fighting leadership prepared to confront these super-rich bosses, unions in retail and elsewhere could link demands for proper pay rises for retail workers to the issue of safety from violence and harassment in the workplace. It could include a demand for employers like Wilko to ‘open their books’. If they ‘can’t afford’ to keep workers in a job, then workers and their unions should be able to check for themselves. We should be able to see where every penny has gone, and demand the money be returned to be spent on keeping stores open and saving jobs. 

A movement like this would itself need to be just a stepping stone into something more. As long as we live under capitalism, the economy will be managed by employers who are only looking out for their short-term profits. Capitalism ensures that bosses are incentivised to asset-strip, to pass costs on to workers, to drive down wages and conditions, and to undermine the long-term stability of the economy. 

Building a real, socialist alternative means bringing Wilko and other high street retail giants, along with the key sections of the economy into democratic public ownership. Decisions over things like prices and wages should be decided by the workers and customers – not the profiteers and shareholders.

Living standards would be drastically improved by public ownership of the energy and housing companies, ensuring they are run to meet people’s needs, rather than for massive profits. Millions of people could be spared from having to choose between paying the bills or paying for food.   

This is the future that Socialist Alternative fights for. Join us!


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