US retailers are expected to hire the lowest number of temporary holiday workers in 15 years due to weak consumer confidence and rising labor costs.
According to a report by outplacement services firm Challenger, Gray & Christmas, seen exclusively by Reuters, retailers are expected to add just 410,000 seasonal jobs for the upcoming holidays based on Bureau of Labor Statistics data. In the fourth quarter of 2022, US retailers added 519,400 jobs.
Bain & Company expects retail sales to grow by just 3% this year, the lowest since 2018, with most of the growth coming from e-commerce and mail-order sales rather than brick-and-mortar retailers.
Deloitte estimates overall holiday sales will total $1.54 trillion to $1.56 trillion between November 2023 and January 2024, up from $1.49 trillion last year.
Like Bain, it expects e-commerce sales to outpace those from physical stores with a year-over-year rise of 10.3% to 12.8%, resulting in e-commerce holiday sales reaching between $278 billion and $285 billion.
“This season e-commerce sales should continue to be strong as consumers search for the best deals online to maximize their wallets,” commented Nick Handrinos, vice chair of Deloitte LLP and US retail, wholesale and distribution and consumer products leader.
“Retailers who remain flexible to shifting consumer demand and behaviors will likely be poised for growth this holiday season.”
Amazon.com Inc (NASDAQ:AMZN) has already announced that it is hiring 250,000 employees for the holidays and lifting its hourly pay rate.
It is getting a head-start on the holiday season, announcing that its Prime members Big Deal Days sale will run from October 10 to 11, with Target Corporation (NYSE:TGT) and Walmart Inc (NYSE:WMT) Inc following this up by announcing pre-holiday sales for the same month.
Contact the author at stephen.gunnion@proactiveinvestors.com