Boohoo's share price plunges as 'sweatshop' scandal engulfs the Manchester company
Plus layoffs at MEN and a lifeline for the arts
Good morning, and welcome to The Mill’s weekly news briefing. These emails pick out some of the most interesting local stories and try to put them in context or add a bit of reporting to help you understand what’s going on.
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Boohoo’s sweatshop scandal
Last month, the Manchester-based online fashion retailer Boohoo was valued at just over £5 billion, more than ASOS and Marks & Spencer put together. Its share price had shot up during the pandemic, as online retailers benefited from the closure of the high street. The company was riding high. This week, all Boohoo’s recent stock gains have been wiped out, knocking about a third off the company’s value. Last night ASOS and Zalando dropped Boohoo’s clothes, following the lead of Next, which did so last week.
The company faces allegations - from a campaign group and various newspapers - that some of its clothing is sourced from factories in Leicester which pay well below the minimum wage. It’s also alleged that some of these factories made staff work through the lockdown, even if they had Covid-19. Boohoo denies the claims, and says it is investigating them. The Guardian quoted a fashion industry source who estimated that around 80 per cent of garments made in Leicester are supplied to Boohoo.
What’s disturbing about this story is how well known it was before this week. The FT published a deep-dive investigation into the “dark factories” in Leicester in 2018 - it’s free online now and is well worth a read. The journalist who wrote it appeared before a parliamentary committee, which then made recommendations about how to deal with the problem of modern sweatshops. The scandal has also been highlighted in parliament by one of the city’s MPs and covered in the local paper. It’s taken the local lockdown in Leicester - with hundreds of journalists sent to stalk the city’s streets - for this story to get proper prominence.
On the off chance: If any Mill readers know anything interesting about Boohoo and its business, please get in touch.
More local media cuts
It’s been a terrible week for regional media. Yesterday, Manchester Evening News owner Reach Plc (which also owns The Mirror, The Express and a string of regional titles) announced it was cutting 550 jobs, or just over a tenth of its workforce. It cited a big fall in revenue, as a result of advertisers pulling their spending. MEN staff have been left in the dark about how many of them might lose their jobs. They read the news online yesterday morning like everyone else, at which point their editor cancelled his bi-monthly briefing. They haven’t heard anything since.
The MEN newsroom has been hollowed out since the 1990s, when the paper had 130 editorial staff. It now has around half that number. That means reporters have less and less time to work on stories - a problem made worse by the need to produce more and more content to drive online ad revenue, the kind of income Reach heavily focuses on. The news follows an announcement by the BBC last week that it is laying off 450 staff working on its regional programmes in England, to save money. Its regional current affairs show Inside Out is being axed as part of the move, and the BBC’s local radio stations are expected to suffer big cuts. Again, these layoffs follow years of cuts to the BBC’s spending on local journalism.
Why it matters: This country’s media is already horribly imbalanced, with most of its staff and almost all its most senior decision makers living in London and the South East. As a result, the national newspapers and BBC focus overwhelmingly on the concerns and priorities of London and its commuter belt. This week’s layoffs will only make that situation worse. Regions like this need a lot more good journalists, not less, and I send my best wishes to those who face the prospect of losing their jobs.
Mike Unger, a Mill reader and a former editor of the MEN, sent me this reaction to the BBC cuts:
It's sad that the BBC, who have a remit to strengthen the regions, have cut hundreds of jobs outside of the London bubble and yet at the same time still find the money to support five orchestras and three choral units - players as well as support staff. This is not in their publicly stated remit and, ironically, they do very little to directly support other arts such as the theatre, art, literature etc. This attitude is elitism of the worst sort by the BBC hierarchy.
Covid deaths falling
Last week I mentioned figures from the Office of National Statistics (ONS) showing that deaths in the North West (and nationwide) had dipped under the five year average for the first time in a few months. That was for the week ending June 19th. That remains the case across England and Wales, where deaths in the week ending June 26th were 3.4 per cent below the five-year average (314 deaths fewer). But the North West has pushed above its five year average again. Here’s what the ONS press office told me about the week ending June 26th:
There are 1300 deaths for the North West with 120 of those involving COVID19. For week 26 on the 5 year average for North West, there are 612 male deaths and 628 female deaths = Total deaths 1240.
That means deaths in the week in question were 4.8 per cent above the five year average (60 more). But that shouldn’t necessarily concern us. The 120 deaths involving Covid is the lowest number for three months (since week 13, ending March 27th). The graph I made below shows how that number rose and fell, peaking in mid-April. I’ll update it every week. No number is perfect, but death numbers are much smaller and more reliably measured than case numbers, which are highly contingent on the number of tests taken, and aren’t released in a uniform way, as the fiasco over Pillar 1 / Pillar 2 data has shown.
WATCH: A short BBC video illustrating how the new cycle-friendly junction in Hulme will work, the first of its kind in the country.
LISTEN: Clint Boon has been interviewing interesting Mancs in a series of podcasts, including the actor Maxine Peake on her upbringing in Bolton.
Arts thrown a lifeline
On Saturday, we published an in-depth story about the financial crisis at the Royal Exchange, and the wider threat facing theatres across the country (if you missed the story in your inbox, try adding our email address to your contacts, or if you use Gmail, dragging today’s email from the Promotions folder to your main inbox). On Monday, the government announced a £1.57 billion rescue package for the arts and heritage sector.
So far it is unclear how that money will be distributed. The Exchange called the package “hugely welcome” on its Twitter account, and said: “We are grateful for such a major industry-wide investment.” The theatre’s press officer didn’t send any further detail when I emailed yesterday. The Exchange did get £571,000 from the Arts Council’s latest emergency funding fund this week, which is mostly funded by the National Lottery and is separate from the government’s announcement. Other local beneficiaries included The Lowry (£1.29m), Oldham Coliseum (£80,000) and the People’s History Museum (£26,000) - you can see a full list here.
Roddy Gauld, chief executive of The Octagon in Bolton said it might be weeks before he knows how his theatre will benefit from the government’s new cash. He told The Mill:
I’m certainly hopeful and the inclusion of a specific investment in building projects such as ours is promising. £1.57bn is a huge investment but until we know how it will be directed it’s impossible to know who it will help. Crucially, until theatres have a date and guidance for re-opening we can’t plan our businesses. So I’m hopeful and very grateful for the promised investment but cautious until we know the facts.
And finally, a good tweet
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