U.S. businesses are hiring fewer seasonal workers this holiday shopping season as lingering inflation clouds the outlook for retail sales.
Employers posted 8.2% fewer vacation openings this year compared to last year, according to job site Indeed. The drop came even as Indeed reported that searches for seasonal jobs rose 33% this year in 2021 to their highest level since 2019.
Macy’s and Walmart said they plan to hire thousands fewer holiday workers than last year. Walmart, which is adding 40,000 people this season compared to 150,000 for the same period last year, said that due to its aggressive recruiting earlier this year, “staffing is stronger as we approach this holiday season than it was last year.”
FedEx Chief Customer Officer Brie Carere said the company is also cutting holiday hiring and expects to handle lower package volume this year.
The National Retail Federation, a trade group, expects retailers to hire between 450,000 and 600,000 seasonal workers this winter, up from 669,800 in 2021. Target, which plans to hire up to 100,000 people for the holiday season, reported an 18% increase. of applicants for seasonal positions compared to a year ago.
“With this shrinking pool of positions and growing interest from job seekers, it does seem like there’s a little less bargaining power on the workers’ side,” said Indeed economist Cory Stahle. “The labor market is starting to cool down a bit compared to last year.”
A year ago, retail employers faced severe labor shortages while consumers, flushed with savings accumulated during the coronavirus pandemic, opened their wallets. But total employment has since risen, suggesting a lower need for temporary workers. In October, government statisticians counted 15.8 million retail workers, up 1.9% from 15.5 million in the same month in 2021.
The National Retail Federation has also predicted a slowdown in spending, predicting holiday retail sales would rise 6-8% year-over-year to between $943 billion and $960 billion in 2022. That would top the rate average growth observed over the last decade. , but would still be below the 13.5% jump seen in 2021.
With consumer prices up 7.7% year-on-year in October, it also suggests that improving retail sales figures will barely keep pace with inflation.
Growing competition for remaining openings has allowed companies to cut hiring bonuses and other incentives to lure applicants. Wage growth for retail trade workers slowed from 7.4% in January to 5.1% year over year in September.
As the labor market begins to ease, fewer American workers are quitting: 4.1 million quit in September, down 10% from the peak of 4.5 million in November 2021.
Michael Alexis is among employers looking to hire less over the holiday season. Last winter, he hired 108 temporary workers, more than double the staff at his corporate events company, Teambuilding.com. The demand for virtual holiday parties had been overwhelming, he said.
But this year, he only needs 75 and his recruiters have had an easier time finding them. “The market seems more interested in our flexible and remote workstations,” Alexis said.
Although seasonal hiring has slowed, it has not stopped. As it did this time last year, Amazon announced plans to hire 150,000 people with an average starting salary of $18 an hour and signing bonuses of up to $3,000.
Macerich, a shopping center operator, has held job fairs across the country to find labor for maintenance and security positions as well as for its retail tenants.
“Pressure [to find workers] eased off a bit,” said Olivia Leigh, executive vice president of Macerich. “It’s not that the pressure isn’t there, it’s just that it’s not as acute as it was maybe six months ago because we’ve seen some of the labor market come back.”
UPS, the package delivery group, held a job fair in Long Island, New York this month. Human resources supervisor Jason Pimentel said that even after making hundreds of on-site job offers, he still had about 200 vacancies at his facility alone.
“It’s a tight labor market. It may have cooled off a bit, but it’s still a very tight job market,” said Matt Lavery, director of talent acquisition at UPS. “It changed a few degrees. It was 700 degrees Fahrenheit, and now it could be like 650 degrees Fahrenheit.
Isaiah Rhodes was among the job seekers who came to the UPS event. He said he was hired after unsuccessfully applying for openings at Best Buy and Nike stores.
“Before today it was difficult for me because I had no experience,” Rhodes said.
Additional reporting by Andrew Edgecliffe-Johnson in New York