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Seasonal employers feeling the squeeze

Seasonal employers feeling the squeeze

By KEVIN TREVELLYAN
ktrevellyan@postregister.com

The lines at Robert Thorne’s UPS Store on Channing Way get a little longer come December.
“It’s like a dam breaking,” he said. “Every year is a little different — all we know is that it’s going to get crazy.”
The influx of winter holiday customers means Thorne hires seasonal employees each year; four to five workers join his permanent staff of eight, typically between November and January.
The workload at Thorne’s store and other shipping outlets increases each year as online sales surge, though big box retailers still hold a fair share of the market and continue to represent a large percentage of retail seasonal hiring needs as winter rolls in.
But this year seasonal hiring at both types of businesses is squeezed by low unemployment.
“When the labor market’s tight people have more options. If they’d prefer a full-time job with benefits, which is usually what the preference is, it’ll be harder to get those people,” Idaho Department of Labor Regional Economist Hope Morrow said.
Nationally, Macy’s is expected to lower its seasonal retail employee count by 3,000 this year while growing its shipping employee base from 3,000 to 18,000. Meanwhile, J.C. Penney will hire 40,000 seasonal workers, which is comparable to 2016, according to Market Watch.
Target will hire 100,000 seasonal employees, up 30,000 from last year.
Locally, department stores that hire seasonally are doing fine, Thornton Oliver Keller Brokerage Services Specialist Brent Wilson said.
Dillard’s, Macy’s and Sears all recently vacated the Pine Ridge Mall in Chubbuck, but Wilson said Bonneville County is in a better position to retain it’s big box stores.
“We’ve got significantly more purchasing power in Bonneville County,” he said. “Our gross retail sales are more than triple what they are in Bannock County, and average household incomes are over $10,000 per family higher in Bonneville.”
If the stores stay, so do their seasonal jobs.
“The seasonal business model means big box retailers like Toys ‘R’ Us and smaller kiosk tenants are going to hire more people for the holidays and that won’t change,” Wilson said. “Those stores are still banking on the holidays for the bulk of their income.”
Regardless of whether a company brings products to a customer’s door or provides them in a store, consistently low unemployment levels are making it difficult to hire seasonal employees.
In eastern Idaho, employment has steadily risen for the last several years, according to Department of Labor data. Private employment numbered 67,491 in January 2015, compared to 71,274 in January 2016.
Statewide, unemployment decreased for the seventh consecutive month this year. It dropped to 2.8 percent in September, the lowest since January 1976.
Retailers across the country are feeling the effects of a shallow labor pool. A UPS sorting center in Ohio lured seasonal applicants with a “full-blown party complete with candy and movie-ticket giveaways,” USA Today reported.
Thorne — whose store is franchised by UPS, but not run by the shipping giant — hasn’t resorted to such drastic measures.
But he has had difficulty hiring seasonal employees over the last three years.
“I compare it to real estate, with buyer’s markets. Right now it’s a bit more of an employee’s market,” he said. “It seems there’s more jobs than people.”
In previous years Thorne advertised seasonal jobs with a notice taped to the door, or a sign on the store’s marquee. This year, he posted listings online.
“We really had to widen the search; we were having trouble getting people to apply,” Thorne said.
The main recourse for finding employees — higher wages.
Though plenty of news stories have detailed general wage stagnation despite low unemployment, NBC News reported seasonal wages climbed 20 to 25 percent between 2015 and 2016.
Morrow expects a similar trend to manifest locally in coming months due to the urgency of seasonal work.
“I think we’ll see more significant wage growth because of the pressure on the labor market,” she said. “Macy’s corporate isn’t going to say ‘It’s OK, we’ll go without seasonal employees this year.’ If it’s two months of $15 per hour instead of $12 per hour for employees, they’ll probably do it.”
Thorne had to increase wages at his own store to attract the workers he needs to combat the coming rush of customers.
“It has put some upward pressure on pay,” Thorne said. “We try to get good people though — you pretty much get what you pay for.”