Survey: Retailers may be hard pressed to find holiday help

Finding seasonal employees may be a challenge this year for the nation’s retailers.

That’s according to a survey by Korn Ferry in which 67% of surveyed retailers said recent hikes in minimum wages and market increases in the retail industry have made hiring seasonal staff more difficult (17% said they expect to see 5% to 10% fewer applicants this year.) Another reason that there are fewer seasonal applicants may be that nearly a fifth of respondents said they pay seasonal employees on average 5% to 10% less than permanent employees, noted Korn Ferry.

In other findings, 55% of retailer they are hiring more seasonal staff in distribution centers due to online sales.

“In this competitive market for qualified candidates, it’s important that retailers convey to prospective and current employees how their organization provides a better culture and work environment than other retailers,” said Craig Rowley, senior partner, Korn Ferry.

Despite potential hiring challenges, retailers are expecting solid sales, with roughly 33% expecting an increase in sales in 2018, and the rest expecting sales will be in line with last year. None believe they will see a decrease in sales this year. The survey also found that some retailers are shifting their discounting strategy, with 36% planning on cutting discounts this year.

As retailers get ready for the holiday season, some are putting more emphasis on their customers’ in-store experiences and are making hiring decisions that reflect that trend. Nearly 15% of the surveyed retailers are looking for employees who better align with brand culture, and 21% are putting a greater emphasis on employees who can help create strong in-store experiences for customers.

The trend of creating a strong in-store experience that reflects a retailer’s brand is boding well for those workers seeking permanent employment. Sixty-four percent of retailers said they expect a higher ratio of permanent to seasonal employees compared to last year. The top reason cited (25%) is that retailers are giving their permanent employees more hours.

“Retailers are increasingly focusing on creating a unique in-store environment, where customers can see and feel the merchandise, which helps them relate more to the company’s culture and ethos,” said Rowley. “Customers may decide to go home and make their purchases online, but that in-store experience will create greater brand affinity.”

Here are some details from the survey:

How much of an increase/decrease in total sales do you predict this holiday season over last year?
5% to 10% increase in sales, 33.33%
About the same, 66.67%

Compared to last year, have the qualifications you're looking for in candidates changed?
Yes, I'm placing a greater emphasis on in-store retail experience, 21.43%
Yes, I'm placing a greater emphasis on fulfillment experience 7.14%
Yes, I'm placing a greater emphasis on employees who align with brand culture 14.29%
Yes, I'm placing a greater emphasis on employees who have more scheduling availability 7.14%
No, my hiring preferences have not changed since last year 50%

If you plan to hire fewer seasonal workers this year, what is the primary reason?
Reduced store sales plan requiring fewer people, 8.33%
Giving permanent employees more hours, 25.00%
I plan to hire the same or more seasonal staff this year, 66.67%

Compared to last year, what is your ratio of permanent to seasonal store employees?
Fewer permanent workers, more seasonal workers, 9.09%
About the same, 27.27%
Fewer seasonal workers, more permanent workers, 63.64%

How have minimum wage increases and or market increases in the retail industry impacted your seasonal hiring?
Hiring seasonal staff is now easier, 8.33%
Hiring seasonal staff is now more difficult, 66.67%
The trend has not significantly impacted our ability to hire seasonal workers, 25%

Do you currently have an omnichannel strategy that has been communicated to the organization?
Yes, 42.86%
No, 28.57%
Omnichannel strategy is still in progress, 28.57%

What are you MOST concerned about negatively impacting sales this holiday season?
General economic conditions, 50 %
Unemployment rates, 16.67%
Competition from e-commerce, 25 %
Other 8.33%

Has the growth in e-commerce sales impacted your seasonal staff hiring?
Yes, we are hiring more seasonal staff in distribution centers due to .com sales 54.55%
No, online sales have no impact on seasonal staffing (in the DCs or stores) 27.27%
Other, 18.18%

Will you be utilizing your mobile shopping platform to help drive sales during the holiday season?
Yes, 81.82%
No, 9.09%
No (do not have a mobile platform), 9.09%

Do you count e-commerce sales in store revenues?
No, e-commerce is counted separately 18.18%
Yes, e-commerce sales fulfilled in a store are counted as revenue 45.45%
Yes, e-commerce sales made in a stores trade area are counted as revenue 27.27%
N/A, 9.09%

Do you have formal training programs in place for seasonal staff?
Yes, 81.82%
No, 18.18%

Are you trying to cut back on discounting overall this year?
Yes, 36%
No, 64%