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New York -- Shaky consumer confidence and increased efficiencies among retailers may put a damper on retailers’ holiday hiring plans, according to global outplacement consultancy Challenger, Gray & Christmas.
In its annual holiday hiring forecast, Challenger estimated that seasonal job gains will not see a significant decline from last year’s robust numbers, but they are likely to at best match the level of hiring that occurred in October, November, and December 2012.
“There are several factors that could keep holiday hiring from reaching last year’s level. While, the economy and job market are improving, it has now been four years since the recession officially ended and millions of Americans are still unemployed or underemployed. As a result, consumers remain uneasy, which is evidenced by wide monthly mood swings in confidence surveys,” said John A. Challenger, CEO of Challenger, Gray & Christmas.
In 2012, retail employment increased by a non-seasonally-adjusted 751,800 between Oc. 1 and Dec. 31, making it the heaviest holiday hiring binge since 2000, when retailers added 788,200 to their payrolls during the final three months of the year. The 2012 holiday hiring total was up 11% from the previous year, when 679,300 extra seasonal workers were hired.
The latest forecast from retail research firm ShopperTrak predicts that sales at U.S. stores will climb rise only 2.4% in November and December compared with increases of 3% in 2012, 4% in 2011 and 3.8% in 2010. Store visits are expected to fall 1.4% during those months. However, consulting firm Deloitte on Monday forecast a 4% to 4.5% increase in holiday sales, on par with last year's gains.
“Price conscious consumers are doing more and more of their holiday shopping online, where they often find the best deals and can typically enjoy free delivery and no sales tax. The ongoing shift to Internet shopping could see some seasonal hiring in this area, but the numbers will never match the employment gains seen in traditional brick-and-mortar establishments,” said Challenger.
For example, this year, eBay has announced plans to add 2,000 workers and Eddie Bauer plans to add 1,200 workers to an Ohio distribution and customer service center. While these numbers are nothing to scoff at, they pale in comparison to the 53,000 seasonal workers to be added by Kohl’s Department Store this year and the 70,000 that Target plans to hire, according to recent announcements
It’s worth noting that the 70,000 holiday workers expected to be added by Target is down from 88,000 a year ago, a decline the company attributed to increased efficiencies and a desire among its permanent, full-time staff to reap the rewards of extra holiday hours.
“The fact is that retailers are getting smarter about staffing. The era of Big Data has armed everyone with the information they need to more accurately predict the ebbs and flows in sales activity and adjust hiring accordingly,” said Challenger.