Facing one of the tightest labor markets in living memory, US retailers and other companies staffing up for the holiday season have had to get creative about finding and attracting the extra workers they need for the seasonal rush. Some retail chains started hiring for the winter holidays all the way back in the early summer, raised entry-level wages for store employees, and offered a variety of bonuses and perks like store discounts.
The retail sector was already feeling pressure to bump up pay, the Star-Tribune reported this week, citing a survey by the hiring platform Snag that found retailers expected wages to rise by 54 percent this year. That’s partly a product of a labor shortage, but also reflects the growth of online shopping:
As more shoppers order online and opt to have items shipped to the store or their front door, retailers’ backroom operations are changing. Mass merchants still need cashiers, salespeople and shelf stockers. But they need more people to package orders for store pickup and to work in warehouses and distribution centers, which increasingly requires more technology skills.
Target is doubling the number of staff it needs to handle digital orders. Macy’s, which is hiring about the same number as last year, will shift its mix and add 5,500 more people for its fulfillment centers. Best Buy says it, too, will bulk up on workers to package up online orders.
Labor market competition, the need to attract and retain more skilled employees, and “HR-as-PR” considerations are all coming to bear on retailers’ decisions to raise pay for their hourly employees. They are also courting hires with new benefits, including intangible benefits like flexibility, Steve Bates notes at SHRM:
The holiday hiring season is already in full swing in the US and the number of seasonal workers hired this year is expected to grow, according to a new forecast from Challenger, Gray & Christmas, citing year-to-year trends and announcements retailers have already made this year:
Last year, seasonal retail employment increased by 668,400 during the final three months of the year, 4.3 percent higher than the 641,000 jobs added in 2016, according to employment data from the Bureau of Labor Statistics (BLS). … Last year, BLS data showed that transportation and warehousing employment increased by a non-seasonally adjusted 279,700, up 13.4 percent from the 246,700 workers in the final quarter of 2016 and 6.6 percent higher than the 262,300 workers hired in this sector in the final three months of 2015.
Companies in this sector are averaging 5.2 million workers this year, compared to 4.9 million in 2015 and 4.2 million in 2008, according to non-seasonally adjusted BLS data.
Challenger points to several companies that have announced they will hire as many holiday season employees as last year or more: Macy’s announced this week that it planned to hire 80,000 seasonal workers, as many as it planned to at the start of the 2017 season (it ultimately hired 87,000 last year). FedEx announced plans for 55,000 holiday hires, a 10 percent increase over last year’s number, and said it would also increase hours for some current employees. The big-box retailer Target, meanwhile, said on Thursday that it would hire around 120,000 seasonal workers for the holidays, 20 percent more than last year, while also raising starting pay by $1 per hour, the Star-Tribune reported:
In a sign of just how proactive employers need to be in the current US labor market, Kohl’s announced last week that it was already taking applications for seasonal positions for the coming autumn and winter, CNN Money reported:
Kohl’s is filling jobs at 300 of its 1,100 US stores for the back-to-school and holiday seasons. Additional jobs at stores and fulfillment centers will come open later in the year. It’s the earliest Kohl’s has ever started hiring seasonal workers, said Ryan Festerling, the store’s executive vice president of human resources.
Seasonal hiring has been increasingly competitive in the US over the past few years, with retailers hiring seasonal help earlier and having a hard time finding the numbers of workers they need. These large employers are hiring store staff by the thousands, but also lots of warehouse and fulfillment roles: a sign of the growing impact of e-commerce. Last year, some companies opted for alternative strategies like giving more hours to existing employees or hiring work-from-home customer service representatives, as means mitigating their need for extra on-site staff in the tight market.
The warehouse club retailer Costco announced on Thursday that it was raising starting wages for its US employees by $1 to $14 or $14.50 per hour, effective June 11, while other workers will receive raises of 25 to 50 cents an hour, Seattle Times business writer Benjamin Romano reported:
The raise, to be paid for with part of Costco’s savings from U.S. federal corporate tax cuts that took effect this year, will go to upwards of 130,000 U.S. employees, costing the company about $110 million to $120 million a year before taxes, Costco chief financial officer Richard Galanti said during the company’s fiscal third quarter earnings report Thursday. … Costco competitors including Target and Walmart announced wage increases and bonuses for their employees tied to the tax cuts earlier this year.
“But not everyone at Costco is happy,” Romano notes:
Some salaried employees, including some in the company’s Issaquah corporate headquarters, say they’re being left out of the equation as Costco spreads around the tax benefit. One person, who asked not to be named for fear of retaliation, said after the wage increase announcement, “I would make a considerable amount more going back and gathering carts for the warehouse in the parking lot.”
Raising pay and benefits for entry-level hourly employees has been a growing concern for US retailers and other low-wage employers in recent years as the labor market has tightened, making even low-skill workers more challenging to attract and retain.
Walmart, the world’s largest private employer, announced at its annual shareholder meeting on Wednesday that it was introducing a new benefit for its 1.4 million employees in the US that will subsidize the cost of their college educations at any of three partner universities, the New York Times reports:
The giant retailer said it would pay tuition for its workers to enroll in college courses, online or on campus, to earn degrees in either supply chain management or business. Full- and part-time Walmart workers can use the subsidy to take courses at the University of Florida; Brandman University in Irvine, Calif.; and Bellevue University in Bellevue, Neb.
The three universities were chosen because of their high graduation rates, particularly among part-time students, and their experience with those already in the work force, Walmart executives said. The Walmart employees will not be obligated to continue working for the company after they get their degrees, and must put up only $1 a day toward the cost of classes.
Walmart says its goal with this benefit is to enable employees to obtain college degrees without taking out loans, in contrast to some other organizations’ tuition benefit programs, which require employees to pay their tuition up front and then seek reimbursement from the company. All Walmart employees become eligible for the benefit after 90 days at the company and are under no obligation to continue working there after they have earned their degrees.
Walmart and the mobile health management platform Sharecare announced a partnership earlier this month that will add a new element to the big-box chain’s wellness offering for its 1.5 million US employees. The partnership will give these employees, as well as their families, access to the Sharecare platform, which includes a variety of biometric data tools, an automated symptom checker to prepare for doctor visits, and tools for finding doctors and managing insurance claims. The program will first be introduced to participants in Walmart’s ZP Challenge wellbeing initiative:
Over the past four years, thousands of Walmart associates have transformed their lives by participating in the ZP Challenge, a series of 21-day programs that encourages and rewards associates and their families to improve their overall wellbeing by making better choices every day in the categories of fitness, family, food, and money. Building on the success of this initiative, Walmart will offer its associates using ZP with access to Sharecare, providing them with even more robust health and wellness resources to help them live their healthiest, happiest, most productive lives.
Walmart also will provide its associates and their families, alumni, and the community at large with full access to Sharecare to help each of them better understand, track, and improve their health, no matter where they are in their health journey.
The rollout to the full workforce will take place gradually over the coming few years, Sharecare president Dawn Whaley told Kathryn Mayer at Employee Benefit News. “We’ll start there [with the ZP Challenge], and then steadily scale over the next three years to engage more than 1 million users across the Walmart community,” Whaley said.
Walmart is piloting a new dress code in some of its US stores that will give employees more options for what they can wear to work, Bloomberg’s Matthew Boyle reported on Thursday:
Employees … will now be allowed to wear shirts of any solid color, rather than just blue or white, according to an employee manual obtained by Bloomberg News. Blue jeans are also permitted — as long as they’re solid blue — whereas previously only khaki-colored or black denim pants were allowed. Visible facial tattoos are forbidden for those hired after April 14, the manual said. …
Some Walmart workers embraced the dress code changes, with one saying on an employee message board: “I would love this! I hope it comes to my store.” Others were skeptical that it would get past the testing phase, which began in fewer than two dozen stores this month.
Walmart last adjusted its dress code in 2015, when it gave its US employees permission to wear black or khaki-colored denim pants and let workers with more physically-intensive jobs wear t-shirts to work instead of collared shirts. That change came after a new dress code the company adopted the previous year—requiring white or navy collared shirts, khaki or black pants, close-toed shoes, and a new design of the big-box store’s branded blue uniform vest—was poorly received by employees, Hayley Peterson adds at Business Insider.