Each year, hundreds of thousands of temporary workers are hired by retailers to handle the demands of the holiday season. The number of seasonal workers added is considered a bellwether for the economy. This season, the projected number of additional hires is unchanged from last year and sales are forecast to be $465 billion, up 2.8% from last year. It is not a recovery when things to improve from a bad year. While some retailers are doing well, others are reducing their seasonal hiring substantially. 24/7 Wall St. looked at the retailers hiring the most people this year to illustrate how important this trend is to the economy and these businesses.
Companies hire seasonal workers for a number of reasons: They are cheap, often earning $8 to $10 per hour, and are willing to work odd hours. This enables retailers to satisfy increased demands without adding a permanent expense to their bottom line.
The massive influx of seasonal workers, which can increase the total workforce of a company by 100% or more, serves another function for retailers: Hiring so many people for a short period allows employers to perform a large-scale talent search. A select group of seasonal workers who prove themselves can get full-time positions after the holidays are over. According to Anne Marie Bishop, JCPenney (NYSE: JCP) spokeswoman, “Getting a seasonal position allows new associates to experience working at JCPenney and decide if it suits them,” and it allows employers to try out new employees.
24/7 Wall St.’s analysis found that some companies, such as Macy’s (NYSE: M)and Kohl’s (NYSE: KSS), are adding 4% to 5% more than last year’s seasonal hires because their businesses have grown. The companies’ stocks are up.
Other companies are hiring fewer workers because they are doing worse than their competition. Best Buy’s net income is flat from the previous year and its stock is down 40%. In September, the company cut its profit outlook significantly. To offset the reduction in seasonal hiring, the electronics retailer is extending the hours of its current workers.
24/7 Wall St. used data from a variety of sources, including company press releases; Challenger, Gray & Christmas; the National Retail Federation; as well as various news outlets to identify seven major American retailers that plan on hiring the most seasonal employees this year. We also looked at the companies’ revenue, total employees and the total number of stores to see how these businesses are faring and how significant the holiday hiring season is for them.
These are the retailers hiring the most people this holiday season.
7. Party City
> Employees to be hired: 14,000+
> Total employees: 1,600
> Revenue: n/a
> Total Stores: 600
The U.S.’s largest party supply retailer, Party City, plans on adding 14,000 employees in the coming weeks, according to NRF. Unlike many other retailers, Party City experiences its greatest need for employees during the upcoming Halloween season. Paty City’s president, Lisa Loeb, said in a recent statement, “Halloween is Party City’s favorite and busiest time of the year, and we hire additional employees to ensure our shoppers receive exceptional customer service during the busy Halloween season.”
>Number of employees added: 35,000
>Total employees: 156,000
>Revenue: $17.7 billion
>Total Stores: 1,108
JCPenney, the 22nd-largest retailer in the U.S., plans to hire 35,000 seasonal workers this year, up from 30,000 last year, according to the New York Times. While almost all will be fired at the end of the season, a few of these new positions are expected to be permanent. As reported in Hire Velocity, JCPenney uses this period as an opportunity to test out new workers, and will hire a portion of the best-performing ones full time after the holidays are over.
>Number of employees added: 92,000+
>Total employees: 355,000
>Revenue: $67.3 billion
>Total Stores: 1,752
Target (NYSE: TGT), the third-largest retailer in the U.S., hired 92,000 temporary workers last year, according to the New York Times. This year, the number is expected to be even more, the Times adds, although the company has not given an exact figure. The Times further reports, “Target has signs in about 170 of its stores encouraging customers to send a text message to get information about holiday employment. Early response has been encouraging, said Eddie Baeb, a Target spokesman.”
4. Toys “R” Us
>Number of employees added: 40,000
>Total employees: 70,000
>Revenue: $13.8 billion
>Total Stores: 873
Toys “R” Us, the largest toy company in the world, experiences one of the biggest employment increases during the holidays. This year, it plans to add approximately 40,000 people, according to the South Bend Tribune. While that is roughly 5,000 less than last year, it is still an increase of nearly 60% from normal employment. According to job-applications.com, the nationwide average wage for seasonal jobs at the company is between $8 and $10.
3. Best Buy
>Number of employees added: 15,000
>Total employees: 180,000
>Revenue: $50.2 billion
>Total Stores: 1,099
Best Buy (NYSE: BBY) has struggled in the past year, and this holiday season is not looking any brighter. Last month, according to Reuters, the retailer announced that it expects holiday sales of consumer electronics to be weak. The company plans to add just 15,000 part-time workers — far less than the 29,000 it hired last year. According to the Huffington Post, the company will also increase the hours of regular employees to make up for the missing hires.
>Number of employees added: 40,000
>Total employees: 29,000
>Revenue: $18.3 million
>Total Stores: 1,100
Kohl’s, one of the largest department stores in the country, announced in a press release last week it plans to add 40,000 seasonal employees this year. This number, which represents an increase of roughly 35 employees per store, is up approximately 5% from last season. According to The Wall Street Journal, “Kohl’s anticipates hiring roughly 2,500 seasonal positions at distribution centers and over 500 seasonal and full-time credit operations positions. Hiring for seasonal workers began this month, and most jobs will be filled by mid-November.”
>Number of employees added: 78,000
>Total employees: 166,000
>Revenue: $25 billion
>Total Stores: 810
Retail giant Macy’s reports that it plans on adding 78,000 seasonal employees, an increase of 4% from last year. As quoted in the New York Times, Macy’s chairman and CEO said in a statement last week, “We expect additional hiring this year given the continued sales growth in our business — both in-store and online.”
-Michael B. Sauter