Holiday Hiring More Ho-Hum Than Ho-Ho-Ho
Policy + Politics

Holiday Hiring More Ho-Hum Than Ho-Ho-Ho

REUTERS/Adrees Latif

While you’re just starting to think about your Halloween costume – retailers are already gearing up for the holiday shopping season. Black Friday is, after all, less than two months away.

But retailers’ holiday forecasts may be slightly less merry this year, if early hiring trends are any indication. After hitting a record high in 2012, holiday hiring by retailers will likely remain flat this year, according to a report by outplacement consultancy Challenger, Gray & Christmas.

The weaker outlook reflects shaky consumer confidence, as well as increased efficiencies among retailers, which enables them to hire fewer workers.

Nerdwallet retail analyst Matthew Ong cautioned against reading too much into the hiring projections, given that last year’s numbers were up 11 percent over 2011. “Percentage-wise, we’re not seeing enormous growth this year,” Ong says. “But it’s important to remember that last year was a huge year.”

Employers hired 751,800 workers from October through December 2012. That was the largest increase since 2000, when retailers increased their payrolls by nearly 790,000 workers.


Stronger hiring in the early part of this year may mean stores have less reason to hire additional workers for the holidays. Retail added 482,000 jobs from March to August, a 42 percent increase over the same period in 2012.

In addition, retailers are increasingly turning to data and technology to become more strategic in their hires, filling the minimum number of positions in order to meet projected traffic on any given day at a particular store.

While holiday employment gives a boost to the economy and provides a temporary income (and a chance at a full-time job later) to thousands of workers, most seasonal hires are part-time jobs that pay at or near minimum wage. The busiest month for retail hiring is November.

Retailers have an even greater incentive to cap the hours they give seasonal employees this year because employers will have to provide health care insurance to any worker who puts in more than 30 hours per week.


Among the large brick-and-mortar retailers, Wal-Mart, which began its holiday layaway program a few weeks ago, is the only one that’s set to add a lot more jobs this year, with plans to hire an additional 55,000 seasonal workers and to transition another 35,000

workers from part-time to full-time. That’s a 10 percent increase in new hires over last year.


By contrast, Target planned to hire fewer employees than last year but would give current workers additional hours, and Toys ‘R Us said its holiday hiring would be flat this year.

Amazon surprised some analysts by announcing that it would add 70,000 temporary jobs this holiday season, a 40 percent increase over last year, and that these would primarily be full-time jobs with benefits. Ong says that may partly reflect a continuation of the company’s huge spending spree this year.

It also reflects a growing shift to e-commerce. While most retailers don’t break out the exact jobs held by their seasonal workers, they’re all adding positions to their fulfillment centers as well as their retail floors.

“Online has become more and more ubiquitous, and retailers are clearly hiring to fit that need,” Ong says. FedEx and UPS have also beefed up their hiring for the holidays in recent years, since the boom in online shopping (and post-holiday returns) means more business for them.

While online sales still comprise less than 10 percent of overall sales, this segment of the market has been growing far faster than overall sales. Last year, total holiday sales grew just 3 percent, while online sales saw an 11 percent hike.

Retail data firm Shopper Trak said last month it expected holiday sales for 2013 to increase 2.4 percent in November and December. But the firm expected a decline in traffic as shoppers visited fewer stores.

Holiday sales account for about 20 percent of annual retail activity. This year the season may be even more stressful, since it follows a lackluster back-to-school shopping season and the season itself is shortened (Thanksgiving falls relatively late this year). One positive sign: Consumer spending rose – albeit by a weak 0.3 percent – in August and incomes inched up 0.4 percent, the most since February.