In Strong Retail Economy And Tight Labor Market, Retailers Tout Incentives
The strong economy continues to set records. April marked the 91st straight month of job gains, the longest stretch in history. That’s good news for retailers, who added 1,800 jobs last month and continue to demonstrate their resilience and innovation as the economy improves.
The hiring spree has also created stiff competition for candidates. The unemployment rate stands at 3.9%, the lowest rate since 2000. Those numbers are expected to remain low through 2020. Even with all the investments in technology and automation, consumers still crave human interaction, and retailers still rely on experienced people at all levels to get the job done. As retailers discover how difficult it can be to find and retain talent, they are using a variety of incentives to attract workers and keep them happy.
Walmart, the country’s biggest private employer, announced a slew of new employee benefits at the beginning of the year. The company expanded its family leave policy from six to 10 weeks of paid maternity leave, along with six weeks of paid parental leave. Walmart also added financial assistance for full-time and salaried workers who are adopting children, and increased its starting hourly wage to $11 per hour.
While bonuses get candidates in the door, some retailers are testing incentives to support workers over the long term. Lowe’s, the home improvement retailer, recently started a workforce development program called “Track to the Trades.” Eligible workers get financial assistance to learn carpentry, plumbing and other trades to address skills gaps in the company and the wider workforce.
Other retailers are investing in workers’ skills and development, too. Kroger recently announced new benefits for long-term employees, including up to $3,500 for continuing education, professional certifications and advanced degrees. A report by the Lumina Foundation found that education benefits can pay for themselves by reducing turnover and personnel costs.
Cash bonuses and tuition assistance are among the headline-grabbing incentives for retail workers, but they aren’t even the main appeal of retail jobs. In a survey of nearly 1,500 U.S. retail workers, respondents ranked scheduling flexibility and types of work as the biggest draws for working in retail. In fact, flexibility is so essential that twice as many candidates want part-time opportunities than in any other business.
There are other, broader changes in the job market for retailers to follow. Retail jobs historically have been popular among teens and young adults looking for part-time, flexible work. But increasingly, manufacturing firms, technology companies and other businesses are snapping up pools of younger workers. According to the Census Bureau, the share of teens working in health services has doubled in the past 20 years.
Still, the retail industry accounts for one out of every four American jobs. Ask around and you won’t be surprised to hear that for many people their first job was in retail, either at the mall, the local ice cream shop, or maybe even bagging groceries. This still holds true today, but the difference is the best people are getting harder to recruit and retain.
Retailers need to turn on the charm to stay ahead of these trends, but this isn’t new for an industry accustomed to constant evolution and change. They are used to creating great experiences for customers. A changing labor environment means they’ll also have to use creativity when building their teams. Hiring managers have to dig deep for talent, because fierce competition for workers is unlikely to ease up anytime soon.
Author: Tom McGee
Source: The Wall Street Journal, May 2018
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