Looks like retailers are going to continue to have plenty of competition when it comes to staffing up for the holiday season.
The U.S. employment market remained surprisingly resilient last month and added 336,000 jobs, well above the monthly average of just 267,000 for the past year, according to the Labor Department’s latest reading.
The September performance put job gains at more than double the 161,500 positions economists had penciled in, according to FactSet.
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While job gains are generally good all around, they complicate the picture for policymakers, who have raised interest rates in hopes of cooling the economy just enough to bring inflation under control.
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But the stubbornly strong job market — the unemployment rate held steady at an ultra-low 3.8 percent — might prompt the Federal Reserve to keep raising interest rates and tip the economy into a recession.
Already, lower- and middle-income consumers are feeling the squeeze and prioritizing spending, fueling up the car or paying the doctor instead of buying the latest fashions.
Chip Bergh, president and chief executive officer of Levi Strauss & Co., told WWD this week that “We are seeing really good momentum on our tier-two and tier-one products in our own retail stores. In wholesale, it’s a little bit of a different picture, and here in the U.S., wholesale is dominantly tier-three product because of the price points that we have to sell at.
“The lower to moderate or middle-income consumer has been significantly impacted by inflation and it’s getting worse,” Bergh said. “Mortgages just hit a generational high, inflation is very high and gas prices are going up again. So that consumer is really impacted.”
Last month, department stores added a seasonally adjusted 2,600 workers to their store payrolls compared with a year earlier, for a total workforce of 958,000. Apparel and accessories stores cut 1,900 workers over the past year to employ 1.1 million.
Stores have started to think about extra staff for the holidays — Target Corp. plans on hiring 100,000 workers, while Macy’s Inc. is looking at 38,000.
But workers still have lots of options.
Last month, the leisure and hospitality sector added 96,000 jobs while 73,000 people took government jobs and 41,000 signed up in health care.