Many retailers are announcing their intent to hire fewer seasonal employees for the 2015 holiday season. For example, Toys “R” Us said it’s planning to hire 5,000 less seasonal employees than last year. Instead it will give existing employees more hours.
Although it is imperative for retailers to turn a profit during this pivotal time of year, they can do so effectively unless they have the optimal staff levels in place to serve customers. Below, the RTP editorial staff shares how they think this move will impact holiday results:
Debbie Hauss, Editor-in-Chief: I’m concerned about this trend for a few reasons. First, of course, fewer hires means fewer people will have holiday jobs and will not have the income available for holiday shopping. This could damage the overall holiday economy and outlook moving into 2016. On the other side, fewer workers could mean that customer service will suffer. But so many temporary holiday employees do not get the training they need in the first place, so giving full-time employees more hours may actually enhance customer service. Either way this is a double-edged sword which is not a positive for all the people and their families who look forward to seasonal employment.
Alicia Fiorletta, Senior Editor: This news puzzles me a bit. I always believe that retailers should live by “supply and demand.” If holiday sales are expected to rise, retailers should follow suit by ramping up their operations and workforce. However, another key consideration is the break down between e-Commerce and brick-and-mortar sales. If retailers predict that e-Commerce sales will rise more than store sales this holiday season, they may be more eager to invest in their digital channels. But in my opinion, retailers should focus on creating a great overall experience; and that means investing in the right people in their stores. I’m excited to see how the holiday season shakes out and how other retailers will be addressing holiday hiring.
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Rob Fee, Managing Editor: I understand the reasoning behind retailers offering more hours to existing employees rather than bringing additional staff on board for the upcoming holiday season. This policy rewards current employees with a bigger paycheck for the season and avoids time consuming training. However, I hope the retailers that have announced lower or flat holiday staffing levels adequately planned for the season because this could greatly impact customer service. Here’s a cautionary tale from the shipping world: In 2013 UPS hired 55,000 seasonal workers. Unfortunately, the company underestimated its needs and had to hire an additional 30,000. Even with the additional employees, many deliveries arrived after Christmas, which led to disgruntled customers and, ultimately, lost profits. By the end of January, UPS shares were down nearly 10%.
Glenn Taylor, Associate Editor: This year will be a tell-tale sign for how retailers approach the holidays in the future. I think the nature of shopping in general has contributed heavily to this decision, as the different sales channels are more prevalent then ever. With numerous different delivery models now in place, and expected to be put in use more in 2015, it doesn’t shock me that a retailer wouldn’t want to put these processes in the hands of a newly trained employee. We hear from consumers about how they want to feel engaged with the associate during the shopping process, and how they want someone who knows what they’re talking about. This move shows that retailers are not only trying to save, but are entrusting those who are most familiar with the company to handle the seasonal rush.
Brian Anderson, Associate Editor: There are pros and cons to this move, in my opinion. Customer service should stay strong since workers will be receiving more hours, therefore making more money. Customers will also be better served since they would be working with employees that have worked with the company for some time – instead of a new employee who doesn’t know where every product is in the store. However, more hours could add stress to the workforce, and add more responsibilities. This mix could lead to a drop in morale for employees. This will be an interesting use case example; I’m curious to see if the pros outweigh the cons, or vice versa.
Do lower holiday hiring rates allude to a less-than-jolly holiday? Share your thoughts in the comments section below!
