UK is worst-performing market for JD Sports as youth unemployment hits sales

📊 Business News Analysis: Our editorial team has analyzed recent developments from theguardian.com in the Business sector. This report covers key insights related to and emerging industry trends that professionals should monitor closely.

Industry observers in Business are monitoring emerging trends closely. Unemployment among young people in the UK is hitting sales growth and profits at JD Sports, the owner of the trainer and sportwear chain has said, amid warnings about the high number of under-25s not in work, education or training. The UK was the worst-performing market for JD Group, which also owns Blacks, Go Outdoors and a number of US and European sports chains. Régis Schultz, the chief executive, said JD was experiencing “pressures on our core customer demographic, including rising unemployment levels, as well as near-term volatility around consumer sentiment”.

Data shows that his comments came as official figures on Thursday showed the number of 16- to 24-year-olds who are not in education, employment or training (Neet) remains stubbornly close to the highest level in a decade. According to reports that graph of number of 16- to 24-year-olds in the UK who are categorised as Neet
Despite a modest decline in the three months to September to 946,000, down from 948,000 in the previous quarter, campaigners said the figures from the Office for National Statistics showed Britain was at risk of failing a whole generation of young people. A million young people aren’t in a job or training. Britain has a problem | Richard PartingtonRead more
The figures mean one in eight young people are Neet amid a rapid increase in unemployment more broadly, with the official jobless rate at 5%, the highest level since the Covid pandemic.

Data shows that last week the Guardian revealed that almost half of all jobs shed since Labour came to power were among the under-25s. Sources indicate that barry Fletcher, the chief executive of the Youth Futures Foundation, said: “This is a long-term problem that continues to negatively shape the lives of too many across the country.”
The squeeze on spare cash for young people contributed to a 3.3% slide in sales at established JD Group stores in the three months to 1 November. Sales were also down in the US and EU – by 1.7% and 1.1% respectively – amid similar pressures as well as a lack of new product launches to draw in shoppers and the slowdown in the trend for women’s vintage trainers. The company has also suffered from a heavy reliance on Nike, which has been struggling to spur consumer interest recently with critics pointing to a lack of new ideas.

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JD stated annual profits would now be at the lower end of expectations, at about £853m, compared with a once-hoped-for £1bn. It was “taking a pragmatic approach” to its outlook for this financial year, due to “incrementally weaker macro and consumer indicators in recent weeks”. Sources indicate that aarin Chiekrie, an equity analyst at the broker Hargreaves Lansdown, said: “Trading across the UK remains particularly weak, with recent changes to employer taxes and minimum wages bringing a handful of extra costs and challenges.”
The weak numbers came as another youth brand, Dr Martens, said consumers were “cautious right now” and “looking for deals” right across Europe and in the US.

The British bootmaker stated it was putting up prices on some items in the US in January to offset the impact of Trump’s import tariffs, which amounted to between £7m and £9m.

These developments reflect broader trends shaping the Business industry as organizations adapt to evolving market conditions.

— Based on reporting from theguardian.com

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Market Impact: These developments in the industry may significantly influence market dynamics. Industry experts recommend monitoring these trends closely for strategic planning purposes.

Analysis Note: This comprehensive overview synthesizes current market intelligence from theguardian.com regarding industry developments and related sectors. Stay informed about ongoing developments in this rapidly evolving landscape.