The number of jobs in the UK convenience store sector has fallen for the second consecutive year, as retailers are forced to adapt to cost increases in their businesses, according to the ACS.

The 2017 Local Shop Report shows that there are now just over 370,000 jobs in the convenience sector – a reduction on both last year’s total of 390,000 and 2015’s total of 407,000.

Key findings from this year’s report include:

• There are 49,918 convenience stores in mainland UK, 74% of which are run by independent retailers, either on their own or in partnership with a symbol group like Spar, Premier, Best-One or Nisa;

• Sales have risen by £500m in the past year to £38bn – which makes this sector of the economy comparable in scale to other large UK sectors like recruitment, defence, and oil & gas;

• 20% of independent convenience store owners work more than 70 hours a week, while 19% take no holiday throughout the year; and

• Convenience store retailers have invested over £858m in the last year on improving their stores, extending the range of services available to customers and making their businesses more efficient.

ACS chief executive James Lowman said: “Convenience stores provide flexible employment for over 370,000 people across the UK, but this number has fallen as a result of significant increases in the national minimum wage and national living wage, as well as other associated employment costs, alongside rising costs in other areas like business rates. In many cases, store owners are having to reduce the number of hours that their staff work while picking up extra hours themselves.

“Despite the pressure faced by retailers as a result of increasing costs in their business, the competition that convenience stores face has never been stronger. Convenience stores have to compete not just with other similar retailers, but also with food-to-go outlets, coffee shops, supermarkets and the growing presence of online grocery retail, which is why there remains significant investment in new technology and services within the sector.

“The intense competition and rising sales in the convenience sector demonstrates that local shops have never been more relevant to the lives of consumers, which is why a number of larger companies are now running convenience stores and moving into wholesaling or franchising in the convenience store sector. Technology and consumer needs are changing rapidly, so stores are constantly evolving to offer more products and services.”