Jobs Report: Holiday Hiring In Today’s eCommerce Era
The final jobs report of 2015 was released on Friday, and with it came some unexpected good news. U.S. employers added 292,000 jobs in December, and the figures for October and November were revised upwards by a combined 50,000. The unemployment rate held steady at 5%, and for 2015 overall the U.S. added a total of 2.65 million jobs.
This means the U.S. labor market has seen annual gains in employment since 2014. Industry-specific job creation was greatest in December among professional and business services (+73,000), construction (+45,000), health care (+39,000), and food services and drinking places (+37,000).
One section of the monthly jobs report we’ve been watching is retail trade, as hiring in this industry typically rises before the holiday shopping season. Now that 2015 has ended we can look back at the year’s holiday hiring and examine the state of retail jobs in the U.S. today.
Holiday Hiring in Retail
First, let’s consider the entire retail trade industry. Total retail jobs (not counting wholesale) stood at 15,710,400 in September, 15,735,000 in October, 15,767,000 in November and 15,771,300 in December. However, those figures are seasonally adjusted. Based on this calculation, retailers added 24,600 jobs in October, 32,000 jobs in November and just 4,300 jobs in December.
This doesn’t quite add up when you remember that many large retailers and couriers each announced plans to hire tens of thousands of temporary workers over the holiday season. Seasonally adjusted numbers mean that the seasonal component of the time period is eliminated, in order to better identify the underlying trends in the data.
So as we approach the holidays, adjustments are made to hiring data to take into account increasing consumption and the resulting increases in temporary retail jobs. If you remove the seasonal adjustment from the December jobs report, retailers actually added 145,700 jobs.
Why does this matter? Any talent acquisition leader who has been diving into metrics lately will understand the importance of putting data in context. Temporary increases to the payrolls at Wal-Mart and Amazon over the holidays tell us more about the health of those companies than that of the retail sector overall.
Retail Jobs in the Long Run
Let’s look at what’s really going on in the retail sector. In December 2014 there were 15,497,300 seasonally-adjusted retail trade jobs. Jump back to this jobs report, and you see an increase of 274,000 up to 15,771,300 in December 2015. So growth in retail jobs looks healthy, right? That picture gets murkier when you consider the retail industry’s share of total U.S. employment:
Since the late 1980s, retail has found itself in a slow decline as a source of jobs for Americans. But again, context matters. Not every segment of retail has been losing workers:
The biggest growth in retail employment has been in warehouse clubs and supercenters–think Costco and Wal-Mart. Meanwhile department stores and electronics retailers have watched their payrolls shrink, as consumers change the way they buy goods. And non-store retailers, like Amazon, have been increasing their market share. But they typically need fewer employees to generate the same level of sales as their aging department store competitors.
The seasonally-adjusted retail data from the December jobs report emphasizes these larger trends. Compared to December 2014, department stores saw their payrolls decline by 33,200, while non-store retailers added 39,000 jobs.
What the Changes in Retail Jobs Mean for Recruiters
For recruiters working to fill retail jobs, the first consideration is which sector of the retail industry are you looking at? Open positions at department stores and appliance retailers may become even fewer and farther between. So that makes it even more important to focus on quality candidates who have demonstrated a real interest in your employer brand, perhaps through social media engagement or job alerts.
Beyond specific retail employers, recruiters also need to consider some big changes in the way retail works. The shift to online shopping means retailers need fewer staff in-store, but more in-house to manage design and technology, handle customer concerns and fulfill orders in warehouses. This is pushing some retail job candidates out, as they don’t always meet the new skills and competency requirements.
Predictions for the future of retail employment run the gamut from modest growth to full automation. But we don’t expect retail recruiting to disappear any time soon. Instead, hiring for retail jobs will need to focus more on building employer brands that attract candidates the way company brands attract consumers. American consumers haven’t stopped shopping, they’re just changing the way retail works. The same can be said for retail employees.
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