The Holiday Season is right around the corner. Are retailers ready?
With unemployment rates at the lowest they have been since 1969, one would think that retailers are fully staffed and ready to roll with the holiday season. However, retailers have lost 11,400 jobs since August. Since January 2017, retailers have lost 197,000 jobs according to the US government.
The National Retail Federation is estimating a 3.8% to 4.2% increase in sales during the Holiday Season. The estimate is greater the five year average of 3.7%. Despite uncertainly due to trade and tariffs, the NRF believes retail is still due for above average sales growth. One reason given is the last holiday season overlapped with a government shutdown. Another was a major sell off in the markets last December.
Both Best Buy and Kohl’s are holding hiring fairs to get as many holiday workers as possible. Kohl’s plan to hire 90,000 seasonal employees and Best Buy plans to hire “thousands” of workers. Macy’s estimates they will hire 80,000 employees and Target wants to hire 130,000 seasonal employees. NRF estimate this year retailer will hire between 530,000 and 590,000 seasonal employees. Last year seasonal employees hired were around 554,000.
Where are these employees going to come from? Not teenagers. Only about 35% of 16 to 19-year-old’s are in the workforce. That means that retailer will have to offer more than minimum wage to get worker. Best Buy plans to offer flexible schedules along with competitive wages, 401K eligibility and a employee discounts. The retail industry experienced the same trouble in 2018. Companies began to offer bonuses and gift cards to lure in workers.
Last year, $126 billion was spent online over the Holiday Season. 31% of that was one by using a mobile device. More and more people are shopping online so it might not matter if there is no one in the stores to help Holiday Shoppers.