2013 Holiday Retail Hiring Highest Since 1999

January 15th, 2014
in econ_news, syndication

DECEMBER HIRING SURGE LIFTS HOLIDAY HIRING TO 14-YEAR HIGH

from Challenger, Gray & Christmas, Inc.

Despite tepid sales gains and lower store traffic this holiday season, retail employment grew by a better-than-expected 801,100 jobs over the final three months of the year, making it the strongest holiday hiring period since 1999.

Follow up:

Overall, the three-month hiring total was up 6.6 percent from the previous year, when retail employment expanded by 751,800 from October through December. The increase was due primarily to strong hiring in October and December. November employment gains were actually down 6 percent from a year earlier.

Retailers added 176,500 workers in December, which is a 63 percent increase from the 108,000 workers hired in December 2012. It was the largest December employment gain for the retail sector since 2005, when these employers added 196,600 in the final month of the year. John A. Challenger, chief executive officer of Challenger, Gray & Christmas stated:

Heading into the holiday season, we anticipated hiring to be flat or come in lower than the previous year. There were many factors contributing to this view, including the fact that consumer confidence was shaken by the recent government shutdown, wages for the majority of Americans remain flat, and millions remain unemployed or underemployed as the economy struggles to recover.

Moreover, forecasts from leading retail analysts were less than optimistic. Retail research firm ShopperTrak predicted in September that sales at U.S. stores would climb just 2.4 percent in November and December. It also estimated that store visits would fall 1.4 percent during those months. Meanwhile, an outlook released by the National Retail Federation last October expected holiday sales to ‘marginally increase’ 3.9 percent, compared to the 3.5 percent increase recorded in 2012.

Surprisingly, while forecasts for marginal sales gains and fewer shoppers proved to be accurate, these trends did not appear to slow down hiring activity. Last week, ShopperTrak reported that holiday season sales increased 2.7 percent while in-store traffic decreased nearly 15 percent.

Meanwhile, post-holiday workforce adjustments may prove painful. Retailers that struggled over the holidays may not only let go of the seasonal workers they hired, but they may include some permanent full-time workers. Macy’s recently announced it would lay off 2,500 workers, close stores, and leave some open positions unfilled. The decision comes after the major retailer revised their second-half same-same store sales estimate for 2013 to 2.8 or 2.9 percent increase in sales, not the 4 percent previously expected. Challenger added:

If other retailers’ sales numbers do not meet expectations, we may see similar staffing decisions elsewhere. Macy’s hired 83,000 workers for the holidays, and Walmart and Target announced comparable hiring figures. Although hiring was better than expected, those employers may adjust staffing back to previous levels, or worse, cut even deeper to eliminate costs.

The widely-reported seasonally-adjusted data, which is intended to “smooth out” volatile fluctuations in seasonal hiring, showed a net gain of 22,300 new retail jobs in November. Challenger uses the non-seasonally adjusted data to capture the actual holiday hiring activity. [Editor's Note: The seasonally adjusted BLS data is so homogenized that subtle data movements are lost. Econintersect continues to use the non-adjusted data in its analysis.]

JOBS ADDED IN RETAIL TRADE

October, November, December, 1999-2013

 

Oct

Nov

Dec

TOTAL

Job Growth Compared to Previous Year

1999

172,200

369,100

308,200

849,500

8.0%

2000

143,600

393,800

250,800

788,200

-7.2%

2001

95,700

352,100

137,500

585,300

-25.7%

2002

125,800

350,500

193,200

669,500

14.4%

2003

145,000

305,100

189,800

639,900

-4.4%

2004

158,000

371,800

180,700

710,500

11.0%

2005

122,300

392,700

196,600

711,600

0.2%

2006

150,600

427,300

169,000

746,900

5.0%

2007

87,900

465,400

167,600

720,900

-3.5%

2008

38,600

213,600

72,700

324,900

-54.9%

2009

45,100

317,100

133,600

495,800

52.6%

2010

149,800

339,200

158,600

647,600

30.6%

2011

134,200

390,600

154,500

679,300

4.9%

2012

149,400

494,400

108,000

751,800

10.7%

2013

159,200

465,400

176,500

801,100

6.6%

AVERAGE

125,160

376,540

173,153

674,853

 

Source: Challenger, Gray & Christmas, Inc., using non-seasonally adjusted data provided by the Bureau of Labor Statistics

 















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