What: John Lewis Partnership anticipates a return to profit and announces significant pay raises amid cost-cutting measures.

Why it is important: This development marks a crucial turning point for the company, demonstrating its efforts to balance financial recovery with investment in its workforce. The return to profitability, combined with the largest pay increase in its history, reflects the company's commitment to both operational efficiency and employee welfare, even as it plans substantial job cuts to streamline operations.

The John Lewis Partnership is set to announce a return to profitability, following three years of losses, as part of an ambitious GBP 900m cost-cutting initiative. Retail analyst Nick Bubb predicts the company will report an underlying profit of approximately GBP 25m, a significant recovery from last year's GBP 77m loss. In a move to reward and retain its employees amid these financial adjustments, the partnership has disclosed its most substantial basic pay increase ever, surpassing both Tesco's and Currys' recent investments in their staff. Starting April 1, this pay rise will elevate minimum hourly wages to GBP 12.89 in London and GBP 11.55 nationwide. These changes come as the company, under outgoing chair Sharon White's direction, seeks to simplify operations to enhance customer service. This strategic overhaul includes cutting up to 11,000 jobs over the next five years, underscoring the complexity of John Lewis's path to sustainable growth and operational efficiency.

John Lewis boss Sharon White hints at looming job cuts despite expected profit rebound