Costa says 1,650 jobs at risk amid pandemic uncertainty

Coffee chain plans to axe assistant manager roles at branches across the UK after slow trade continues, despite lockdown restrictions easing

Costa's announcement comes a week after rival Pret A Manger revealed it was slashing 2,800 roles (Reuters)

Costa Coffee has said 1,650 jobs are at risk as it seeks to cut costs amid continued uncertainty over when trade will recover after the coronavirus pandemic.

The coffee shop chain closed nearly all 2,700 of its UK stores for six weeks during the pandemic and while 2,400 have re-opened, business has been slow to return in some areas.

More than two months after most retailers were allowed to re-open their doors, the numbers of people visiting shops and cafes in city centres is down by more than a third.

Costa’s announcement comes a week after rival Pret a Manger revealed it was slashing 2,800 roles as part of a restructure.

Both companies rely on trade from commuters, many of whom have continued to work from home despite the government urging people to return to workplaces.

Costa, which is owned by Coca-Cola, said it had been boosted by the government’s VAT cut on food and non-alcoholic drinks and the recent half-price meals scheme.

But redundancies were necessary because of “high levels of uncertainty as to when trade will recover to pre-Covid levels”, Costa said.

The company proposes to remove assistant manager roles at each of the 1,600 branches it owns. The cuts will amount to around 10 per cent of the company’s UK staff.

Costa franchisees operate a further 1,100 stores that make their own decisions about staffing and are not directly affected by Thursday’s announcement.

Costa stressed that staff will be given the opportunity to apply for other roles within the company where possible.

Neil Lake, managing director for Costa Coffee UK and Ireland, said: “Today’s announcement to our store teams was an extremely difficult decision to make.

“Our baristas are the heart of the Costa business and I am truly sorry that many now face uncertainty following today’s news.

“We have had to make these difficult decisions to protect the business and ensure we safeguard as many jobs as possible for our 16,000 team members, whilst emerging stronger ready for future growth.

“As a proud member of the UK high street, we remain committed to the role Costa plays in supporting the economic recovery of the country, but today I want to say a huge thank you to all of our team members that are affected by this announcement and we will be supporting you throughout this process.”