Cooling labor market doesn't dampen holiday hiring frenzy

Cooling labor market doesn’t dampen holiday hiring frenzy

WASHINGTON — Despite headlines of massive layoffs at corporate America and fears of a recession, it’s still a labor market for those seeking temporary vacation jobs as retailers and shippers continue to fight for employees ahead of what they expect to be a peak holiday shopping season.

Companies have drastically accelerated the hiring process to increase their workforce amid fierce competition for workers. Some have raised pay to over $30 an hour in some markets, are offering up to $3,000 in signing bonuses, or are holding mass hiring events to secure workers before getting better deals. elsewhere, according to companies, recruiters and economists.

Retailers are entering the holiday season amid a flurry of mixed economic signals. Inflation remains at its highest level in decades and there has been an increase in mass layoffs and hiring freezes, but the unemployment rate is still relatively low and consumer spending has remained strong. That leaves businesses looking forward to another busy shopping season as they continue to face a competitive job market.

“It’s still a very, very difficult hiring environment, especially in states and cities with very low unemployment rates,” said Julia Pollak, chief economist at ZipRecruiter. “Employers tell us that they still have a hard time finding qualified candidates and finding motivated candidates. So even when they sign candidates, they’re very scared of the ghosts, that people won’t show up on day one, because people have so many alternatives and take the best offer they get.

Retailers expect holiday sales to rise 6% to 8%, with companies planning to hire 450,000 to 600,000 temporary workers – at the peak it would be down from last year, and if retailers hit the bottom of their hiring targets, it would be the lowest number of temporary hires since 2009, according to the National Retail Federation.

The vacation hiring comes at a time when retailers were already employing the most workers since 2016 and the number of transportation and warehouse workers is at record highs, according to the Bureau of Labor Statistics. Before the holiday hiring rush, retailers were already looking to fill 800,000 vacancies, according to the retail federation.

But at the same time, this tight labor market has benefited retailers as the holiday season approaches, as it has driven up wages, giving consumers more money to spend, even in times of inflation. massive.

“The job market is a real conundrum for employers and that’s one of the reasons why consumers have behaved so resiliently because wages are rising and there’s pressure in the market, which that gets people to spend,” Matt Shay, president of the retail federation. , said in a call with reporters earlier this month.

There are, however, signs that the labor market is beginning to shift in favor of employers. Job seekers are looking for seasonal work at the highest rates since 2019, with searches up just over 16% from a year ago, according to data from Indeed. Meanwhile, seasonal job openings are 2% lower than last year, according to the hiring website.

“We are seeing fewer vacancies than last year and more people are searching in this small pool of vacancies, and the result is that workers may have a little less bargaining power than they did. had on the seasonal market last year,” Cory Stahle said. , senior economist at Indeed. “But we’re still in this very tight labor market where even though things have cooled down a bit, the labor market is still very tight.”

For UPS, which is once again hiring 100,000 seasonal workers this holiday season, it remains a war of candidates.

The company has streamlined its hiring process, eliminating in-person interviews, so that in 25 minutes it is able to process an application, make a job offer and complete required payroll documents for the vast majority of its openings, including warehouse workers, package handlers and pilots.

“Someone doesn’t apply for one job, they apply for 10 jobs, and the company that best meets that candidate’s needs will eventually win that candidate,” said Matt Lavery, global sourcing director, hiring and onboarding at UPS. . “We try to increase our chances with each candidate by being as transparent, being direct and also paying a very good salary.”

The company is on track to meet its hiring goal, but some areas remain particularly hard to find workers, such as Minneapolis, parts of New England like Cape Cod, Denver and surrounding mountain communities.

“It is difficult to give a national vision that is a vision of the whole country. It’s really different stories within the country that you have to pay attention to and be very nimble and very nimble in adapting to,” Lavery said. “Some pockets are maybe a bit better than last year, and in some areas it has become extremely difficult.

Macy’s Inc. has also sped up its hiring process with applications taking just five minutes and the majority of applicants receiving offers within 48 hours. The retailer will add 41,000 holiday workers to its Macy’s, Bloomingdale’s and Bluemercury stores starting at $15 an hour and offering up to $500 in referral bonuses.

“This speed is imperative when hiring vacationers,” John Patterson, vice president of talent at Macy’s, said in an email. “While our application process is fast, we ask important questions. Last year, this centralized and improved hiring process allowed us to hire fewer colleagues of higher talent levels with a more competitive salary which remained, resulting in a 40% reduction in turnover.”

Although Amazon cut up to 10,000 head office jobs, it said last month it planned to add 150,000 seasonal workers with an average starting salary for warehouse and delivery workers of 19 $ per hour and signing bonuses ranging from $1,000 to $3,000.

The US Postal Service will only hire half the number of people this year compared to last year, but officials say it is in a better staffing position heading into the holidays than last year and increased its automated processes to meet growing demand. Postal officials assured members of Congress in a hearing earlier this month that they would have the necessary staff this holiday season and would be able to avoid a scenario like 2020 when the agency was struggling to deliver packages before Christmas.

“We never have enough people, I’ve been here for 25 years, but we manage. We move people, people work overtime, people do amazing things,” Edmund Carley, national chairman of the United Postmasters and Managers of America, said during the hearing. “We’ve hired over 400,000 people over the past two years and we’re still hiring, so I don’t think I’ll ever be full. We are still working, but we will deliver. It will be a successful season, I’m sure.

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