Retailers are bracing for a holiday worker shortage — and shoppers should be, too

Here’s one more reason to shop earlier this Christmas season.

For decades, the cessation of seasonal holidays was predictable, and the positions were filled by people who needed extra money to buy gifts. There will be plenty of seasonal jobs, but workers probably not. Unemployment is high and there is also a shortage of labor.

Retailers are preparing for this.

Target last week awarded $ 200 “appreciation” bonuses to 340,000 frontline employees, the sixth time it has given bonuses to store employees since the pandemic began. Walmart made tuition fees free for employees, including books.

44% of retailers offer sign-up bonuses on Snagajob, the largest hourly work platform, and have nearly all of the top 50 US retailers among their customers.

Normally, such an offer is irrelevant for employees without a salary, said Mathieu Stevenson, CEO of Snagajob. “Now it is part of a strategy not to increase long-term costs with higher wages.”

In the second quarter, wages rose faster than they had been in 13 years. Private consumer spending rose in June, and while the private saving rate fell slightly, it remained historically high in June at 9.4%.

Turnover rates have skyrocketed and voluntary resignations are at an all-time high that every employer is trying to keep their employees, Stevenson said.

As the holiday season approaches, there are almost 70% more vacancies than there were in pre-pandemic times and 10% fewer people looking for work, he said. “That’s the biggest gap in recorded history.”

The current environment for vacation rental hiring is unprecedented, said Craig Rowley, Senior Client Partner at the Korn Ferry Dallas office.

More than half (51%) of retailers surveyed in July said they had moderate difficulty hiring store staff and 36% said they were facing significant challenges, he said.

The hiring crisis comes as retailers forecast a great year. In June, the National Retail Federation revised its forecast for retail sales to grow 10.5% to 13.5% to more than $ 4.44 trillion this year. The previous forecast was that retail sales will grow 6.5%, roughly the same as in 2020 when consumers shifted their spending from experiences, travel and eating out during the pandemic.

And it’s hard for smaller retailers to keep up with the big boxing chains that have raised wages to $ 15 an hour, Rowley said. “Multiple customers are raising prices by at least a dollar an hour.”

“Customers will see less service and notice that more shelves are filled during the day than at night because it’s easier to get people to work from 9 to 5,” he said.

Existing employees are being asked to work more hours and store opening hours may not be as long as usual during the holiday season, Rowley said. “I encourage everyone I know to shop early.”

One of the main reasons vacation rentals will be challenging this year is because people don’t need the money, Rowley said. If you use a pencil for a 10 to 15 hour job for six weeks, you get around $ 1,000. Families with two or three children will get that kind of extra cash from the child tax break introduced in July, he said.

Many frontline workers suffer from psychological burnout, Stevenson said, and they worry about their own safety, higher childcare costs, and ongoing concerns for family members at risk.

Some experts see the end of state unemployment benefits in September as a tipping point, but Stevenson said payments have ceased in several states, including Texas, and there have been no major changes in the labor supply.

He believes traditional employee perks such as tuition fees and bonuses will continue to be offered to hourly workers. Branch operations need workers who can develop, and hourly workers need to see a clear career path, he said.

Many retail executives started out as seasonal workers, and seasonal jobs have long been touted as a route to permanent employment.

The gig economy, which has expanded along with the rise in on-demand services and for a while seemed to have a head start on hourly retail jobs, but these jobs are not for everyone.

“I’m always amazed at the surroundings of a retail store, especially a grocery store,” said Stevenson. “It comes with a sense of family that doesn’t exist in a gig job.”

His advice to workers: “If there is a dream job for you in retail, this is the time to apply. Employers need you. “

Twitter: @MariaHalkias

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