CLEVELAND, Ohio — The busy holiday season is here, but the seasonal employees retailers need to meet the rush don’t seem to be arriving in time.
“Workforce issues continue to plague retail and there are more shoppers out this year than maybe even in 2019,” said Gordon Gough, president and CEO of the Ohio Council of Retail Merchants.
Judging from available data, retailers across the country seem to be thousands of workers short of their hiring goals. And while retailers have plenty of technology — like self-checkouts, computer systems doing the ordering, phone apps for curbside pickup and even bots that scan the shelves — it isn’t making employees less needed.
“We have not seen much correlation between technology and a reduction in the workforce,” Mark Mathews, the National Retail Federation’s vice president of research. “It seems a little counterintuitive, but it doesn’t seem like there’s a one-to-one relationship there.”
To cope, some stores in the Cleveland area have tried luring workers with bonuses and developed ways to cope with fewer employees.
The National Retail Federation predicted in November that retailers would hire between 500,000 and 665,000 seasonal workers, up from 486,000 in 2020. However, job data shows retailers are likely coming up short of their goals.
Jack Kleinhenz, the NRF’s chief economist, said data from the U.S. Bureau of Labor Statistics paints a negative picture.
Looking at monthly job data, Kleinhenz said retailers added 221,000 jobs between September and October, and another 331,000 by November. But, he said retailers are roughly 100,000 to 125,000 workers short of November 2019.
With low rates of unemployment, Kleinhenz said there are more openings than jobless people looking for jobs.
“We are finding employees, but still not enough for the number of openings that we have,” Kleinhenz said.
When the NRF surveyed retailers earlier in the fall, they reported back that it was hard to find employees both in the stores and in warehouses. Large firms are adjusting and putting more workers in distribution centers to meet online needs, Kleinhenz said.
Businesses were, and still are, offering incentives to get people in the door — like signing bonuses and higher starting wages.
It’s hard to know whether larger or smaller retailers are bearing the brunt of this.
Gough said while many retailers put out in September that they were in need of thousands of employees, they don’t normally report how successful those campaigns were — and consider them trade secrets.
Retailers are getting some relief, Gough said, from parents looking for extra spending money and returning to the workforce students.
College students help fill the void locally
“My take on it is it’s been a little difficult, but we’re getting some relief from the college kids coming home,” said Gordon Geiger, owner of Geiger’s, a sporting-goods store headquartered in Lakewood.
Geiger said the store normally has 20 to 25 people on staff, and brings on 4 to 6 more for the holidays. He said he has had luck hiring outdoor enthusiasts, who have a little more passion for the part-time job. The extra people help in a time that is stressful for retail staff.
“Business has been brisk for sure,” he said.
At the CLE Clothing Co., owner and founder Mike Kubinski said hiring has been a mixed bag. He said the downtown, Crocker Park and Van Aken District stores are pretty much set. Summit Mall’s location in Fairlawn has been a different story.
He said he had people not show up for interviews, or even get hired and then not show up.
Bonuses and lean staffing
Kubinski said his company used strategic hiring bonuses at places that needed staff. Summit Mall’s location is still offering a bonus.
Staffing isn’t the same as it used to be, though. Kubinski said his stores are not at 2019 levels.
“We kind of run the stores a little leaner than before,” Kubinski said.
Part of that means bringing all-hands on deck during busy times. If the online distribution needs help, Kubinski said he’s packing boxes.
The retail federation’s Kleinhenz said small and large stores do seem to be handling the shortage differently. One key thing the NRF has seen, he said, is owners working many more hours than they have in the past.
Technology won’t solve worker shortages
Mathews said there’s no doubt that the pandemic accelerated trends toward technology, whether that was more self-checkouts, mobile scanners customers can use to ring out while they shop or the buy online, pickup in-store model.
But technology hasn’t been reducing the number of employees needed overall or per store, he said.
“The reason for that is even if you automate the employee out of a particular role, you still need employee in other roles,” Mathews said.
The exact number of self-checkouts is hard to measure. But Mathews said data from 2000 to 2015, which is when self-checkouts went from rare to extremely common, the number of workers per store at large supermarket chains has been relatively flat.
“It hasn’t had an impact on the number of employees at all,” Mathews said.
He said technology that replaces simple tasks, like checking out, frees up employees for more productive tasks like picking online orders, stocking shelves and helping the retailers build branding across the store.
Still, Gough expects technology to keep growing in retail, especially when it makes shopping more convenient. He expects trends, like shopping carts that ring you out, to catch on.
Many people are using technology they wouldn’t have in 2019, since consumers were forced to try it and ended up liking it amid COVID-19, Gough said.
Holiday sales projected high, despite hiccups
Despite the staff shortages, and supply chain issues to boot, retailers are still expecting an increase in sales this holiday season.
The National Retail Federation said it expects holiday sales to be anywhere from $843 to 859 billion, up from $777 billion in 2020. Ohioans are expected to spend $31.4 billion on holiday shopping this year, a 7.3% increase from 2020, according to the Ohio Council of Retail Merchants report.
Broadly speaking, Kleinhenz said retailers are getting by with less staff, based on the sales numbers he’s seeing.
“Overall, retailers have been very resilient,” Kleinhenz said.
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