The tectonic shift in retail is shaking up how stores hire seasonal workers

The tectonic shift in retail is shaking up how stores hire seasonal workers
By: WNG CNBG Posted On: December 06, 2019 View: 30

The tectonic shift in retail is shaking up how stores hire seasonal workers

With consumer preferences shifting, holiday hiring needs have also changed, with more emphasis on speed and e-commerce.

Big retailers are set to hire some 790,000 seasonal workers this year, marking the second year of major growth after several years of stagnation, according to data from outsourcing firm Challenger, Gray and Christmas and CNBC. The process started months ago and continues for many in this tight labor market.

Still, the shift to e-commerce means fewer jobs. Nonsupervisory retail jobs shrank by about 23,000 in the past 12 months, according to the Bureau of Labor Statistics. Retail jobs increased by 1.4% over the same period.

Much of that growth is due to Amazon, which said it would hire 200,000 seasonal employees this year, double the number in 2018. Traditional retailers like Macy's and Kohl's said they plan to hire 80,000 and 90,000 workers, respectively.

Target said it plans to add 130,000 seasonal workers this year and noted that many will become permanent positions after the holiday ends — 40% of seasonal hires stayed on after the holidays in 2018, the retailer said. Target also doubled the number of team members it has dedicated to fulfillment, including same-day services, to ensure guests get their orders even faster.

A target store advertises for workers near its entrance in Encinitas, California, May 24, 2019.

Mike Blake | Reuters

The trend is common throughout the sector, with retailers hiring more behind-the-scenes workers this year as store traffic declines, says Jan Kniffen, retail consultant and CEO of J Rogers Kniffen WWE.

"We're hiring less customer-facing people and a lot more people that are doing something else to help the customer, taking care of 'order online and pick up in store,' curbside pickup," Kniffen said. "That requires a lot more people, they are doing the job the customer used to do."

Other retailers are taking a different approach — giving holiday hours to current employees. While Gap set out to hire 30,000 seasonal workers this year across its brands including Old Navy and Banana Republic, it also turned to current staff to offer additional holiday hours. Walmart said it is skipping seasonal hiring altogether, taking the hours available during the holidays and giving them to current employees. Some seasonal hiring may take place on a store-by-store basis, the company said.

Target said it checks with current workers to understand their availability and interest in working additional hours ahead of its seasonal hiring.

"This is so much easier, if you can get someone who knows the job who is already working for you to burn more hours, because then you don't have to do the retraining and hiring and all of the things that are really costly," Kniffen said. "Any time you can spread the hours over the existing workforce, and they are willing to do it, it's going to be easier to do."

That's something that lawmakers like Sen. Elizabeth Warren will likely be glad to hear. The Democratic presidential hopeful introduced a bill this week to protect part-time workers during the holiday season. The measure requires large employers to offer their current workforce more hours before hiring new employees or subcontractors, and would allow workers who are part-time to take part in pension plans. It would also allow them to be eligible for family and medical leave.

The move may also prove strategic in an increasingly competitive and tight labor environment. Companies "are all struggling to keep the place full, because there are opportunities out there that are paying more, or may be more fun places to work," Kniffen said.

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