Survey data released by the CBI business group on February distributive trades showed balance of 49% of retailers had slashed their workforce, the highest cut since 1983. While record 45% stated that they planned staff reduction for March.

However, survey revealed better-than-expected performance in first two weeks of February, with 25% balance firms reporting decline in sales on 47% balance in January.

The figures were higher on the 52% balance of retailers who had forecasted fall in sales in February due to effects of heavy snowfall.

Official data from ONS (Office for National Statistics), showed better performance than survey data, indicating an unexpected 0.7% rise in January sales.

According to the UK economist, Vicky Redwood, at Capital Economics, rebound in February sales was surprisingly strong, but cautioned that it should not be considered as sign of sustained recovery.

She feels that aggressive discounting may have prompted heavy spending in January; longer rebound in sales will mean that consumers are spending cash which is freed up by falling energy prices and mortgage payments. But, she adds that rising unemployment and drop in property prices would force consumers to start saving extra money instead.

According to the chairman of CBI Distributive Pane and CEO of Asda, many retailers have been cutting jobs in February, but conditions were less harsh than in January and March is likely to be equally testing.