Retailers scramble to attract workers before the holidays

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Macy’s offers referral bonuses of up to $ 500 for each friend or family member employees recruit to join the company. Walmart pays up to $ 17 an hour to get started and has started offering free tuition to its workers. And some Amazon warehouse jobs now order signing bonuses of up to $ 3,000.

Retailers, who expect the holiday shopping season to be lively again this year after being devastated by the coronavirus in 2020, are scrambling to find enough workers to staff their stores and distribution centers in a market tense work. Attracting candidates to an industry that has been battered, more than most, by the many challenges of the pandemic, from fights over wearing masks to high rates of infection among employees, is not proving easy to be attracted to. Volunteer retail workers are likely to earn larger paychecks and work fewer hours, while consumers may be greeted by less inventory and understaffed stores.

“People looking to work in retail typically have very little choice – this is largely due to geography and availability of hours,” said Mark A. Cohen, director of retail studies at Columbia University Business School. “Now they can choose those with the best benefits, bonuses and hourly rates. And as we have seen, the escalation has been striking.

Or as Jeff Gennette, the general manager of Macy’s, who plans to hire 76,000 full-time and part-time employees this season, put it in a recent interview: “Everyone is going through this – there is a war. for frontline talent. My feeling is that we all have to raise our level of play. “

While some of the more generous benefits, like tuition reimbursement, are offered primarily to long-term workers, even seasonal workers will receive a higher salary than usual. Hiring temporary help this year is especially critical for retailers, as existing employees are already strained by nearly two years of the pandemic. The National Retail Federation, an industry group, anticipates record sales for the holidays and predicts that retailers will hire 500,000 to 665,000 seasonal workers, far more than 486,000 in 2020.

“The biggest risk for retailers and distributors is that they are overworking their current workforce,” said Scott Mushkin, who founded financial consultant R5 Capital, based in New Canaan, Connecticut. “Overtime cannot go any further. The workforce is exhausted.

Mr Mushkin saw how eager retailers are to work during a visit last month to a Home Depot in Naperville, Ill..

“I was looking at a sign listing vacancies in the store when I was approached by a manager who asked if I was interested in applying,” Mushkin said.

Mr. Mushkin said he was struck not only by the manager’s desperation, but also by the number of positions available. “Basically all the jobs in this store are open,” he said. “So who does these jobs now?” Who takes over? “

These pressures may explain why large retailers like Walmart are looking to hire an additional 150,000 workers to supplement their current staff this season. For several years before the pandemic, Walmart offered existing workers overtime during the holidays, but didn’t start a big hiring blitz. (Existing employees can still sign up for overtime.) He recently increased his minimum wage to $ 12 an hour, and in some stores, he’s offering new workers $ 17 an hour.

Amazon is also on the hunt for 150,000 more people this holiday season, which follows a push to increase its permanent workforce by 125,000. As giant retailers gobble up many job applicants, attract new employees is all the more difficult for others.

Many retailers, like Saks Off 5th, have reiterated their pledges to stay closed on Thanksgiving Day this year, a welcome change for workers after a long shopping trend invading the holidays. Requiring employees to work in stores on this day would likely be a particularly tough sale this year.

Nordstrom, which aims to hire 28,600 seasonal and regular employees, said it had increased bonuses and incentives to $ 650 for hourly and night store workers, from $ 400 last year.

Saks Off 5th said in October it was raising its minimum base wage for hourly store workers to $ 15 an hour – more than double the federal minimum wage – and that it would not offer extended hours holiday shopping this year so staff can have more flexibility.

Best Buy allows job applicants to submit videos rather than physically showing up for a first round of interviews, saying in a recent release that the videos “can be recorded and reviewed without the need to come and go on the site. planning”.

The retail rush comes as the US economy strengthens, creating 531,000 jobs in October, a sharp rebound from the previous month. But even though unemployment fell to 4.6% from 4.8%, the labor force participation rate – which measures the share of the working-age population employed or looking for work – remained stable last month at 61.6%. This signals that the pool of available workers remains small.

“We are coming out of a crisis with which we have no experience, in which millions of people have been put on leave or made redundant or taken out of the labor market, and think that they will all show up by a certain date to return at work is a bit silly, “Cohen said.” Some people are still afraid to come back to work, especially in a job where they would be exposed to a lot of people. “

While fear of the Delta variant may keep some workers away, the retail industry has been reluctant to impose vaccine mandates for fear that store workers will leave and it will become even more difficult to find seasonal workers. . A new vaccination or testing requirement for companies with 100 or more employees announced by the Biden administration on Thursday essentially forced their hand, though it was not expected to go into effect until Jan.4 and was temporarily blocked on Saturday. by a federal court of appeal. in Louisiana. (The mandate calls on employers to require unvaccinated workers to wear masks by December 5.)

The National Retail Federation has criticized the mandate, saying it places “onerous new demands on retailers during the crucial holiday shopping season.”

Stephen Smith, managing director of LL Bean, the Maine-based outdoor retailer, said it was “incredibly difficult” to hire hourly workers, especially for its more than 50 stores. The chain does not offer bonuses, but it has favored new forms of flexibility to attract workers. For example, the jobs at its home call center are now entirely remote.

In stores, Smith said, “we’ve changed our shift structure so you can do two or four hour shifts” in an effort to “make things a lot easier if you juggle responsibilities. family ”.

The company also sought to emphasize its unique benefits, including multiple paid days off for employees to have outdoor experiences.

The challenge of finding workers has highlighted the difficulty of many retail jobs and the lack of consideration given to many store workers during the worst of the pandemic. They have been regularly exposed to Covid-19 and involved in disputes with customers over wearing masks, and have been inconsistently offered a risk premium or other compensation for their efforts. Many traders said they were not properly informed when exposed to the virus in stores.

Anthony Stropoli, personal shopper at Bergdorf Goodman, has one of the lucrative direct customer-facing jobs that have faded into retail in recent years and has noted that luxury retail is a ball game different. He previously worked at Barneys New York, which filed for bankruptcy in 2019.

“A lot of people don’t want to work in retail right now – I really, really see it,” Stropoli said. “People don’t feel appreciated or fairly paid, and I think this whole Covid thing has really made them rethink that. They want to feel valued.

It all means that the workers are carrying more weight this season than in the past. Joel Bines, the global co-leader of the retail practice at consulting firm AlixPartners, said if retailers are to find enough workers this season, they need to pay them more and fundamentally improve working conditions.

“For retailers, who have treated their employees as essential cogs in order to increase their bottom line, it’s hard to believe that they are shocked not to find people to work for them,” Bines said. .

“The thing the industry needs to understand is that workers now have the power to act,” he added. “They have an agency in a way that they’ve never had before.”

Contact Sapna Maheshwari at [email protected] and Michael Corkery at [email protected]

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