Retailers are beginning to announce holiday hiring plans and early signs point to higher seasonal employment levels this year, according to a forecast from outplacement firm Challenger, Gray & Christmas. emailed to Retail Dive Thursday.
More robust hiring plans come despite store closures, consolidation and price competition in retail, according to the report. E-commerce and omnichannel fulfillment centers, and not just store floors, are in need of added personnel, Challenger noted.
In fact, price cuts announced by the likes of Target, Walmart and Amazon are likely to spur holiday shopping and could be partly why retailers are beefing up their seasonal workforces, Challenger said.
For the past few years, big-box retailers have kept holiday hiring steady, while Amazon has been prominently beefing up its seasonal ranks. With e-commerce playing an increasingly critical roll during the holiday season, retailers seem to be catching on to the need for more warehouse and fulfillment seasonal help.
Overall seasonal retail employment rose by 641,000 during the final three months of last year, the lowest since the 495,800 retail hires announced in the final months of 2009, Challenger noted in its report. In fact, last year’s job gains were 9.6% lower than in 2015, when retailers added 708,800 jobs, according to employment data from the Bureau of Labor Statistics.
E-commerce growth and a shift to omnichannel are decidedly making their mark on the hiring picture in the fourth quarter. Last year, for example, BLS data showed that transportation and warehousing employment rose by a non-seasonally adjusted 246,700 workers in fourth quarter, 8% percent higher than the 228,400 workers hired in that sector in the final three months of 2015, Challenger noted, while in 2007, the seasonal job gains for that sector measured just 24,300.
"As holiday shopping habits turn virtual, retailers are responding by hiring more warehouse and transport workers," CEO John Challenger said in a statement. "While retail hiring has fallen over the last couple years, major announcements indicate workers will still be needed for customer-facing positions, as retailers attempt to give consumers an experience they cannot receive online," Challenger said.
The firm’s forecast relies in part on the retailers that have begun to announce plans. Target was the first mass merchandiser to do so, announcing this week that it will increase holiday hiring by 40% — adding approximately 100,000 workers in its 1,816 U.S. stores, plus another 4,500 for its distribution centers and fulfillment facilities. "The increase in hires — which will help us keep improving our guest service — is part of the investments we announced earlier this year," the company said.
The move this year is an adjustment in favor of brick and mortar, considering the 70,000 seasonal workers hired in stores and 7,500 in its distribution and fulfillment centers a year ago. In addition to Target’s announcement, Michaels has announced 15,000 holiday workers, and 1-800-Flowers announced 8,000, according to Challenger.
"The competition among major big-box retailers will incentivize consumers to spend more this holiday season," he said. "These stores will need to add staff in order to meet demand."