LONDON — Tesco supermarket, the largest grocer in Britain by market share, said it was planning to cut thousands of employees, an attempt to fend off challenges from discount retailers and a possible Brexit downturn.
The chain, which employs more than 440,000 people globally, said that it expected 9,000 jobs in Britain to be affected, but that half of the workers could be moved to other positions. The decision comes more than four years after Tesco started a price-cuts campaign and revamped stores to win back customers.
Tesco shares closed down 1.73 percent on Monday.
Retailers in Britain have been under pressure for months. Consumer spending on food rose slightly over Christmas, but retail sales overall were flat. It was the worst December in 10 years for retailers and a sign of a tough year ahead given uncertainty over Brexit, according to the British Retail Consortium.
Tesco still accounts for the largest share of sales at supermarkets, but it is facing increasing competition from discount stores like Aldi and Lidl and online shopping.
The supermarket industry has also been preoccupied with the possibility that Britain will crash out of the European Union without an agreement on its separation, an event that could disrupt the supply of food, about of a third of which comes from the European Union. Growth in the supermarket sector has also slowed.
Dave Lewis, Tesco Group’s chief executive, wrote in the company’s 2018 annual report that “consumers are feeling the impact of economic uncertainty.”
The chief executives of several Tesco competitors on Monday signed an open letter warning that a no-deal Brexit could put pressure on food supplies. Tesco executives did not sign the letter, but its annual report noted that leaving the European Union could increase import costs, drive up inflation, and affect its ability to recruit.
“In our four years of turnaround we’ve made good progress, but the market is challenging and we need to continually adapt to remain competitive and respond to how customers want to shop,” Jason Tarry, Tesco’s chief executive for Britain and Ireland, said in a statement on Monday.
The company also said it would close deli counters at about 90 stores. Employees in Tesco’s head offices will also be affected.
Tesco made a similar announcement about simplifying operations in January last year, eliminating jobs such as “people manager” and “compliance manager.” That move affected 1,700 people. The company pledged in 2016 that it would reduce its costs by £1.5 billion, or about $1.7 billion, by the fiscal year ending 2020.
Pauline Foulkes, the national officer at the Union of Shop, Distributive and Allied Workers, said workers were devastated by the news. “Staff at Tesco are shocked and dismayed by the scale of yet another round of potential job losses, which clearly demonstrates the pressure retailers are under in the current very difficult and uncertain economic climate,” Ms. Foulkes said in a statement.