High street banking chains are faced with a difficult position at present – many face accusations of withholding lending from small businesses, while the Government is throwing substantial support behind building societies and alternate lenders in a bid to “increase competition” in the financial sector. Yet with the financial difficulties which have plagued both businesses and consumers fresh in the minds of all, reverting to the pre-recession lending free-for-all is a gamble many are reluctant to take.
This state is further complicated for chains which received bailouts from the taxpayer at the height of the financial crisis, such as Lloyds. The bank has now announced the closure of a further office in Southend, Essex, bringing its total number of announced job losses to 2,750 so far for this year alone.
More than 600 staff members will face redundancy when the office closes its doors, with the remaining workers being redistributed into Lloyds’ commercial and insurance operations. A further 250 staff members from other operations around the country will lose their positions as part of the money-saving move.
In a statement, Lloyds was keen to highlight that voluntary redundancies will be sought and compulsory job losses will very much be viewed as “a last resort.”
It continued; “Lloyds Banking Group is committed to working through these changes with employees in a careful and sensitive way.
“All affected employees have been briefed by their line manager. The group’s recognised unions were consulted prior to this announcement and will continue to be consulted.
“In fact, during 2012, around only a third of role reductions led to people leaving the group due to redundancy.”
However, the UK’s largest union, Unite, has reacted with outrage to the announcement and has called for better treatment of staff within the banking sector. National officer Dominic Hook hints that Lloyds is more concerned with the welfare of its backers and financial partners than of its staff.
He says; “Lloyds is celebrating a return to profit and there are hints of dividend payouts to shareholders, but the bank’s workers are in constant fear that they will be next for the chop.
“This is no way to treat staff – it’s time to urgently review this continuous tide of cuts and build the bank’s strength.”
Cuts have certainly played a major role in the banking sector of late, with Unite claiming that the UK’s largest chains have shed more than 5,000 positions so far this year.
With Britain’s employment rate unsteady at best, this could potentially throw a spanner in the works of economic recovery if the present rate of redundancies keeps up.
Mr Hook continues; “The constant job cuts across the banking industry is bad for bank staff, does nothing to support customers and it’s bad for Britain’s economy.”
But with banks still reeling from the economic crisis, the question is whether social responsibility or financial security will win out in the minds of executives.
Do you think banks should be attempting to build up capital by any means necessary in order to safeguard against the need for a future taxpayer bailout, or should the major high street chains be showing more loyalty towards their long-standing members of staff?
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