Fighting low unemployment and stiff competition for workers, local companies are scrambling to hire thousands of seasonal workers before the biggest shopping season of the year.
The hiring spree that spans several industries is happening earlier than most years and is requiring companies to offer incentives and flexible hours to entice job applicants for the mostly part-time work. Stores like Kohl’s and JCPenney started their hiring drives as early as June.
“They know that there are constraints on the current workforce because the economy is doing so well, so they want to get out ahead of time,” said Gordon Gough, president and CEO of the Ohio Council of Retail Merchants.
Just in this region, the L Brands’ call center in Kettering, the Kohl’s distribution center in Monroe and Target’s warehouse in West Jefferson are looking for several thousand part-time workers.
The companies are competing with full-time, permanent, higher paying jobs that have openings under these economic conditions. Miami University economist William Even said that will make finding part-time, seasonal workers especially challenging.
“The majority of workers prefer long-term jobs over seasonal work, though some workers prefer part-time over full-time jobs,” Even said. “The challenge is that when the job market is strong, more and more workers are able to get full-time year-round employment, which leaves fewer workers for the part-time seasonal jobs.”
Paige King, who studied early childhood education at Sinclair Community College, visited the L Brands booth at a Wright State job fair last week. L Brands, which owns Victoria’s Secret and Bath & Body Works, is hiring 2,000 seasonal positions for its Kettering call center, with a chance to become full time at the end of the holiday season.
While she wants a permanent, full-time job in her field, the call center is an option to quickly start making money, King said.
“To make the jobs attractive to those who already have full-time jobs, employers may have to be more flexible with work schedules,” Even said.
With more disposable income in the hands of many Americans during this strong economy, experts expect holiday sales to increase this year, in line with the increases retail sales have seen throughout 2018.
The National Retail Federation estimated that retail sales will increase at least 4.5 percent year-over-year. Even said he expects consumer sentiment, and therefore spending, to remain high throughout the rest of 2018, providing a tariff war doesn’t escalate.
Professional services network Deloitte forecasts holiday sales between November and January to reach $1.1 trillion, an increase of between 5 percent and 5.6 percent over last year. The biggest jump will be seen in online sales, with an expected increase between 17 percent to 22 percent.
Among the increased activity during this holiday season, more retail, distribution, fulfillment, logistics and delivery industry workers are needed. Target plans to hire 20 percent more seasonal workers this holiday than last to deal with the influx in shopping.
But the workforce is tighter this year than most.
“There are some challenges when the economy is doing well and you have low unemployment to find suitable workers… everybody is trying to fill their workforce needs,” Gough said.
The unemployment rate has declined every August since 2009, reaching 3.9 percent this year, according to the Bureau of Labor Statistics. Many economists say the United States is at full employment, where everyone who wants a job has one except those who are between jobs.
The job openings rate for July was higher than unemployment at 4.4 percent, or 6.9 million open jobs — more than 1 million more than the number of hires for the month, according to BLS. Roughly 757,000 retail jobs specifically were open, about 100,000 more than last year.
President Donald Trump’s tax reform this year added to the increased employment in the retail sector, according to the NRF. Retailers are one of the biggest winners of the reform, which dropped corporate tax rates from 35 percent to 21 percent.
The University of Pennsylvania estimates the tax reform will save retailers $171.4 billion over the next 10 years— money the retailers have reinvested into jobs and expansion, which will lead to even more new jobs, Gough said.
The Target store on North Fairfield Road is an example. The store recently began renovations and expanded its pickup and delivery services. Target as a whole plans to hire 120,000 seasonal employees nationwide, including hundreds in the region.
But even before its holiday push, the store is looking to fill 30 permanent cashier and logistics positions brought about by increased foot traffic through the store and increased e-commerce thanks to the store’s pickup program, said team leader Andrew Holtz.
Delivery companies like United Parcel Service also needs employees, with the popular delivery company estimating it will hire 100,000 seasonal workers, about 5,000 more than last year. UPS spokesman Dan McMackin said that increase is a result of additional facilities the company built to handle growing e-commerce volume.
“The labor situation is definitely tight this year, with unemployment in many markets at all-time lows, so we are working hard to recruit and retain,” said UPS spokesman Dan McMackin.
Companies are starting to add benefits and raise pay to recruit employees in a highly competitive workforce, including seasonal workers.
UPS takes on about 35 percent of its seasonal workers for permanent positions. The permanent workers receive health care, pension benefits and tuition reimbursement up to $25,000, McMackin said.
Target also recently announced it would raise starting wages to $12 an hour, with plans to continue increases to $15 by 2020. Macy’s, which plans to hire 80,000 seasonal workers, has started offering both seasonal and permanent employees a quarterly incentive if they meet measurable goals.
Kohl’s, which plans to hire 90,000 seasonal associates, will increase its employee discount from 15 percent to 35 percent during the busiest time of the season.
Recently unemployed Robert Dutmers was at Wright State’s job fair last Wednesday. He wants full time, permanent work in IT, and said was frustrated by the number of temp jobs advertised at the fair.
In response to the labor shortage and demands for more stable jobs, some companies are making traditionally seasonal jobs full time. The Kohl’s e-commerce fulfillment center in Monroe, which hired 2,400 workers for the holidays last year, plans to hire 3,300 seasonal workers this year. The positions are advertised as full-time.
Filling the jobs
Despite more jobs than unemployed people to fill them, Gough said, the distribution, fulfillment, logistics and call centers, along with retail stores will get enough workers to operate during the busiest shopping season of the year.
“During the holiday season, you have a segment of the economy who chooses to dip in and out of the workforce, so you may have a two parent household where the mother may choose not to work nine months of the year, but to pay for Christmas gifts, she may enter into the workforce during the holiday season,” he said.
Students and retirees who may not have previously been looking for work will also fill a large share of the seasonal jobs this year, Even said.
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