WASHINGTON -- The holiday hiring season has started, and it looks as if it will be a challenge to match or surpass last year’s strong showing. The sluggish economy is growing, but well below its potential, and competition is fierce from online companies, which hire fewer workers.
“Last year was a boom year for hiring. It surprised everybody, the degree to which retailers were hiring,” said John Challenger, the CEO of labor market consultancy Challenger, Gray & Christmas Inc. “It seems unlikely that it would repeat.”
The good news, according to Challenger, is that retailers will add more workers, and it’ll mark the fifth consecutive holiday season with rising retail employment. The bad news: Last year is hard to top.
Holiday hiring in 2012 hit a 12-year high, with retail employment gaining almost 752,000 jobs from Oct. 1 to Dec. 31. That’s more than double the 324,900 workers added in 2008 – the year of the financial crisis – which was the lowest number of new retail jobs in this period since 1982.
Those dark days are in the rearview mirror, but there’s reason to think that the holiday hiring period that begins Tuesday will fall short of last year’s, even as sales are projected to increase modestly.
The analytical firm ShopperTrak forecasts a 2.4 percent increase in holiday retail sales in November and December, a slower pace than last year’s 3 percent sales gain. Shopper traffic is projected to fall 1.4 percent this year compared with last year’s 2.5 percent increase, ShopperTrak said.
“This holiday season we really could see more of the same. We’re certainly expecting growth; the question is how will this year’s growth compare to last year’s,” said Kathy Grannis, a spokeswoman for the National Retail Federation, noting that households are richer with rising home prices, the stock market is strong and auto sales have been booming . “All these positive indicators have not shown up at the register in 2013 so far for retailers.”
Consumers can expect earlier-than-usual promotions because this holiday season will have fewer peak shopping days than last year’s.
“Retailers have a reduced window of time to capture peak holiday spending, as only 25 days lie between Black Friday (Nov. 29) and Christmas this year, compared to 31 days in 2012,” ShopperTrak said, pointing to four full weekends to shop after Black Friday, not last year’s five.
That’s one of several reasons for the expected slower pace in retail hiring this holiday season.
Retailers also have grown savvier, Challenger said, “taking advantage of ‘big data’ to hire more accurately, and the slow but steady move to online retail requires fewer retailer workers.”
Also, advancements in software allow retailers to better gauge what days and times customers are most likely to visit stores, and companies are staffing accordingly.
“Even within stores that are brick and mortar, they are using more and more technology to aid the customer, and that means fewer people (working) in the stores,” Challenger said. “Now much more, the store will be filled with people (working) at peak times, but when times are slow there won’t be the same number of people in the store.”