10.3% More Seasonal Hires in 2012 Than 2012

John Challenger of Challenger, Gray & Christmas

Despite some year-end uncertainty related to fiscal cliffs, a devastating hurricane and election-year politicking, retailers were confident enough in the final three months of 2012 to ramp up holiday hiring to its highest level in six years, according to an analysis of government employment data released by global outplacement consultancy Challenger, Gray & Christmas, Inc.

Employment in the retail sector increased by a net 728,300 jobs, between October 1 and December 31, according to non-seasonally adjusted data, released last week by the United States Bureau of Labor Statistics.  That is 10.3 percent higher than 2011, when retailers added 660,200 extra workers over the final three months of the year.  The nearly 730,000 retail jobs added this year represents the strongest year-end hiring surge since 2006, when employment in the sector increased by 746,900.

The bulk of the 2012 holiday hiring occurred in October and November, when employment grew by 149,600 and 490,400 workers, respectively.  Retailers hired just 88,300 additional workers in December, which was actually down significantly from the 147,600 workers added in December 2011.

“The fact that holiday hiring in the retail sector reached pre-recession levels is remarkable for a few reasons.  More people are working, but many are still under-employed and, as a result, wages have remained stubbornly low.  So, spending power this year was not necessarily greater than a year ago.  Additionally, more people are shopping online, where increased holiday demand is more easily met without adding a lot of seasonal workers.   Yet, despite these factors, brick-and-mortar retailers moved forward with increased hiring,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“An early Thanksgiving, which meant earlier Black Friday sales, may have contributed to an earlier hiring surge.  Additionally, a growing number of retailers opened their doors on Thanksgiving Thursday, which may have also boosted the need for extra hiring in order to ensure that enough workers were available to staff these holiday hours,” he noted.

Retail sales, excluding drug stores, increased 4.8 percent in December, according to Retail Metrics.  The International Council of Shopping Centers estimates that its members will show an increase about 4.0 percent total for December.  Meanwhile, e-commerce was up 14 percent for the entire holiday season, according to comScore.

“Some industry analysts are expecting retail sales to maintain some momentum into the new year, as consumers spend gift cards.  However, gift card traffic is unlikely to result retailers holding on to all of the extra holiday workers.  Some may stay, but the vast majority will be let go,” said Challenger.

After adding 660,200 seasonal workers over the final three months of 2011, retail employment fell by 789,400 in January and February 2012.