A Glut of Retail Jobs Means Higher Pay and Better Benefits for Workers

Shoppers enjoy their shopping experience at Tampa International Mall on Saturday, July 29, 2017. Tina Russell/The Penny Hoarder

Major U.S. retailers are scrambling to find workers to fill a record-high number of job openings, and that’s a good thing for current and potential employees.

As the holiday hiring season approaches, job openings in the retail industry are already at record levels. According to the latest Bureau of Labor Statistics (BLS) data, the retail industry had an unprecedented 835,000 job openings in July — the highest number since the BLS began tracking this statistic in December 2000.

Anticipating a strong holiday season, employers are adding hundreds of thousands of additional seasonal jobs into the mix as well.

Filling these job openings is the biggest hurdle the retail industry faces, according to Evan Armstrong, Vice President of Government Affairs at the Retail Industry Leaders Association. The RILA represents the largest retailers in the U.S. — Walmart, Target, Costco, Walgreens and many others.

The labor shortage is a big problem for retailers. But for average retail workers?

“That’s good news,” Armstrong said. “There are a lot of employers out there competing for them.”

The stiff competition for labor leads to better schedules, wages and benefits for workers. For example, Target, which plans to hire 120,000 additional seasonal workers,  is offering starting hourly wages at $12, with a $500 gift card bonus for workers hired after September.  The company also plans to increase all beginning wages to $15 an hour by 2020.

In June, Costco hiked starting wages to $14 an hour. Both full- and part-time hourly workers are eligible for health care, dental care, dependent care, 401(k) and several other benefits, according to its website.

Gap Inc. announced Monday that it is looking for 65,000 seasonal workers. The company has encouraged job seekers to show up at any Gap Inc. store or distribution center to apply for a job (including its related brands: Banana Republic, Athleta and Old Navy).

“The truth is,” Armstrong said, “there are just not enough people to work all the jobs that are open right now.”

So large companies are trying these creative and innovative methods to attract employees. Armstrong said that they aren’t only competing among themselves, but the retail industry as a whole is competing with the gig economy for labor.

Younger workers, especially, are attracted to the “work-when-you-wanna-work” aspect of the gig economy.

“The gig economy is providing so much more scheduling flexibility,” Armstrong said. “Retail is trying to catch up on that.”

Armstrong thinks that the seasonal benefits retailers are offering could be a play to attract a new wave of employees to remedy the overall labor shortage in the retail sector. Over the past year, retail wage growth has outpaced that of other industries. If the intense competition among retailers continues, employees can expect benefits to keep getting better.

“Retailers are getting folks in the door in the seasonal space,” Armstrong said. “Then they can retain them throughout the rest of next year.”

Adam Hardy is a reporter, editorial assistant at The Penny Hoarder. He writes about careers for The Penny Hoarder’s Make Money vertical. Read his full bio here, or say hi on Twitter @hardyjournalism.