High streetThe number of shops fell by almost 600 last month even before the recent collapse of a raft of High Street names, according to new research.

Despite the grim statistic, employment in the retail sector rose by 0.6% in the final quarter of 2012 compared with a year earlier, driven entirely by part-time workers, the study found.

Related stories

Broken Britain


Half of the firms questioned by the British Retail Consortium (BRC) said they planned to cut staffing levels in the next few months, with only 4% expecting to create jobs.

The survey, covering 1.3 million workers at 25 major retailers, showed that Christmas was not a disaster for traders, but staffing levels were kept "modest".

Helen Dickinson, director general of the BRC, said: "The fact that total employment edged up during this quarter, driven by part-time workers, is a shaft of light against an otherwise challenging backdrop. It shows that, despite relentlessly tough times, retailers are continuing to invest in people and support job creation as much as they can.

"But the record drop in store numbers is stark evidence that this investment should not be taken for granted. We're by no means out of the woods yet, and given the administrations of recent weeks, the next quarter's figures are likely to make difficult reading."

The reduction in the number of stores - 573 in December compared with a year earlier - was the highest since the BRC started monitoring the situation four years ago.

Christina Tolvas-Vincent, of business law firm Bond Pearce, which helped with the report, added: "After a lacklustre Christmas, the New Year has started badly for retailers. Well publicised failures such as HMV, Jessops and Blockbusters have yet again placed the spotlight on the struggling high street. This will have an even greater impact on store numbers that are already falling at the fastest rate for over four years."

A Department for Communities and Local Government spokesman said: "High streets are facing challenges such as the rise of internet shopping, which is why the Government is offering practical support. That's why we've doubled the amount of small business rate relief and extended it for a year to help up to half a million new and smaller shops.

"For budding entrepreneurs, we're providing over £80 million of start-up loans for young people starting their own businesses."