(Bloomberg) --

UK retailers are cutting jobs and scaling back investment in response to mounting economic gloom, according to the Confederation of British Industry.

Headcount slumped in the year through November, marking the first decline since August 2021, the business lobby said in a report Monday. Investment intentions meanwhile fell the most since the early phase of the pandemic 2 1/2 years ago.

Overall sales volumes fell at a “solid pace,” with furniture and carpet stores, grocers and non-store retailers registering the biggest declines. A similar decline is anticipated in December. 

The downbeat findings ahead of the key Christmas trading period reflect the cost-of-living crisis, which is leading households to spend less on non-essential items. Inflation pressures showed no signs of abating, with average selling prices rising at close to the fastest pace in the survey’s 37-year history. 

The sector remained pessimistic about the outlook, the CBI said. Stocks were considered too high relative to expected sales, suggesting near-term demand will be met from the storeroom shelf. 

The volume of orders placed with suppliers fell in November and a sharper decline is expected next month, according to the survey, which was carried out between Oct. 27 and Nov. 14. 

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