Widespread store closures are rapidly becoming the norm across the global retail industry, with thousands of locations shutting down at an unprecedented pace.
While the decline of physical stores has played a major role in job losses, another force accelerating the shift is the rapid adoption of advanced technology and artificial intelligence (AI). Retailers are increasingly restructuring their operations to prioritize automation and efficiency, often at the expense of traditional roles.
As a result, positions that were once considered essential are now being eliminated as redundant or cost-intensive. For many companies, workforce reductions are no longer a last resort, but a strategic decision tied to long-term transformation.
Among the latest to reveal cuts is Morrisons, underscoring a broader trend that could reshape employment across the retail sector.
U.K. supermarket chain Morrisons has revealed plans to cut approximately 200 roles at its Bradford head office, placing around 8% of its workforce at risk.
The affected positions span key departments, including the marketing, commercial, and technical teams.
Company leadership cited rising insurance costs, the ongoing cost-of-living crisis, and higher fuel prices tied to geopolitical tensions in the Middle East as contributing factors, according to employee accounts reported by GB News.
However, the layoffs are also part of a broader, multi-year transformation strategy focused on accelerating AI adoption and automation across the business, an initiative that began in 2025.
A Morrisons spokesperson told Better Retailing that the program is intended to “ensure our central functions are better placed to serve our stores and strengthen our ability to deliver for customers in the current very challenging market conditions.”
Morrisons confirms more layoffs amid an AI transformation.Shutterstock
The latest layoffs follow a series of cost-cutting measures by Morrisons in recent years.
In March 2025, the retailer planned widespread closures, including 52 in-store cafés, 18 market kitchens, 17 convenience stores, 13 florists, 35 meat counters, 35 fish counters, and four pharmacies, according to the BBC.
While many affected employees were expected to be redeployed, approximately 365 roles remained at risk.
These moves reflect a broader effort to streamline operations and reallocate resources toward higher-margin and technology-driven areas of the business.
Despite ongoing closures and layoffs, Morrisons has reported solid financial performance, according to its latest earnings report.
£233 million (about $315.6 million) in annual cost savings
This brings total savings to around £845 million (approximately $1.14 billion), with Morrisons targeting £1 billion (about $1.35 billion) in savings by the end of fiscal year 2026.
The results highlight a growing trend across the industry, where companies are becoming leaner and more profitable, even as workforce reductions continue.
Morrisons is far from alone. Across retail sectors, major corporations are increasingly linking layoffs to AI investments and digital transformation initiatives.
Recent examples include:
Amazon: Cutting around 16,000 corporate roles to fund AI initiatives, according to Amazon News.
Nike: Laying off about 775 jobs in distribution and operations, CNBC reported.
Home Depot: Reducing approximately 800 positions, many in technology functions, CIO Dive confirmed.
Target: Eliminating around 1,800 corporate employees as part of an AI restructuring, according to The New York Times.
For many companies, AI is being positioned as both a competitive necessity and a cost-saving tool, enabling automation, streamlining workflows, and enhancing customer experiences.
However, analysts note that AI is typically one of several factors driving layoffs, alongside macroeconomic pressures and shifting consumer demand.
Experts suggest AI adoption may already be influencing hiring trends.
“There is considerable speculation that the adoption of generative AI was a cause of recent layoffs and slowed hiring, particularly in the tech industry, for entry-level workers, and in customer service and programming jobs,” said Harvard Business Review analysts Thomas H. Davenport and Laks Srinivasan. “More may be coming.”
While cost-cutting and automation have long been part of retail strategy, the speed and scale of AI-driven restructuring mark a significant shift.
Industry analysts increasingly view these changes as structural rather than cyclical, potentially affecting not only frontline retail workers but also mid-level corporate roles in functions such as marketing, operations, and administration.
Morrisons’ latest cuts show how even traditional grocery retailers, which have historically been less exposed to automation than other sectors, are now accelerating AI adoption at the corporate level.
The decline of physical retail is reshaping not only business operations but also local economies, employment opportunities, and community infrastructure.
“The widespread closures of physical retail stores in the digital age significantly impact business outcomes, urban communities, and regional economies,” said industry researchers at ScienceDirect.
“Understanding this phenomenon is crucial for retailers, policymakers, and society at large.”
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