Retail jobs are going through changes as store closures take place everywhere due to the coronavirus pandemic, while others remain at risk.
Retail jobs are described as more vulnerable than ever as several retailers have already filed for bankruptcy. Meanwhile, an increasing number of customers prefer to shop online and receive their orders through curbside pickup or house delivery. This led to a high demand for people to pick and pack items.
With this, many retail workers have been recruited, laid off, furloughed, or given new roles. Analysts and trade groups reiterate that the Covid-19 pandemic could change the size and the framework of the retail industry today and for years to come.
According to the National Retail Federation, more than one in four American jobs were supported by the retail industry before the US faced the coronavirus crisis. This made retail the most thriving private sector-employer in the country. This figure involves people who work directly for a retailer, like at a clothing store, coffee shop, or warehouse. It also includes jobs produced by the industry, such as construction workers building a mall.
The US Bureau of Labor Statistics reported the number of workers in stores has been reduced. Around 15.7 million were employed by retailers in February. This figure declined by about 2.4 million in March and April. There was a recovery in May and June as stores started to reopen. As of June, there are around 14.4 million employees in the retail sector.
According to the US Bureau of Labor Statistics, there were 1.9 million store-based retail workers unemployed, with 1.1 million of those regarded as temporary layoffs, such as furloughs.
Leaner operations
The retail workforce could be further reduced as retailers acknowledge their inability to do payroll with the same headcount as costs from wages to disinfecting stores increase or realize they can operate with a smaller staff.
“If retailers discover that they can do more with less, we may see a permanent decline in the total number of retail workers,” Forrester analyst Sucharita Kodali said.
She noted that e-commerce can also operate leaner. “The warehouse is made for kind of the minimum number of people who have to be there to pick and pack orders,” she said.
Kent Knudson, a partner in Bain & Company’s retail practice, believes that the long-term losses will be biggest among department stores and other specialty apparel retailers that were already suffering before the coronavirus pandemic.
Based on the Labor Department’s data, retail employment declined by nearly 13% year over year, as of June, but has dropped by more than 50% for retailers that offer clothing.
The federal agency’s labor classification for retail is made up of predominantly store-based employees and doesn’t include some retail-related jobs, such as truck drivers or warehouse employees.
Grocers and warehouse clubs are among the rare thriving fields, as they recruit more people to meet strong sales.
According to Knudson, the factors that will shape the future of the retail workforce are the two major upcoming shopping seasons: back-to-school and the holidays.
If consumers pull back on spending due to unemployment or economic uncertainty, it will “accelerate the downward trajectory,” he said.
