Home improvement retailer Lowe’s Companies Inc. (NYSE: LOW) plans to add more than 65,000 jobs this year. The number is huge, based on the fact it employs 310,000 people today. It is a sign of the company’s optimism about the housing market, which is one of the largest engines of the U.S. economy.
Lowe’s management said the jobs are an investment in customer service. The company assumes that the improvement will help it get new customers and maintain its current customer base.
The decision is also an addition to the belief of some economists that rapid job growth in America is not over. The Bureau of Labor Statistics reported that the economy added 312,000 jobs in December, one of the highest totals since the end of the Great Recession. While the retail industry has been shedding jobs in general, the Lowe’s decision shows the healthier ones are moving in the opposite direction.
Marvin R. Ellison, Lowe’s president and CEO, commented as he announced the new plan:
We are sharpening our focus on retail fundamentals and simplifying our business. We are investing in key leadership positions across our stores to enhance customer service while also creating jobs that will improve the availability of our most popular products, transform our technology infrastructure and provide more access for customers to the home improvement expertise of our store Associates.
The jobs will be added in three of Lowe’s large operations. More than 50,000 seasonal positions will be added for the spring indoor and door period. Presumably, many of these jobs will disappear after summer. Almost 10,000 permanent associates will join what Lowe’s calls it Merchandising Service Team, which manages inventory. And about 6,000 will be added to what Lowe’s calls full-time assistant store manager and department supervisor roles. That will be to bolster customer service
Lowe’s recently has done well financially. Its revenue has risen for the past three years. In the most recent year, revenue hit $68.6 billion. Net income was $3.4 billion. However, it is up against a much larger competitor. Home Depot had revenue of $100.9 billion last year and net income of $8.6 billion. Lowe’s also competes against the home improvement section of large retailers like Walmart, as well as legions of small hardware stores.
Lowe’s addition of 65,000 new jobs in 2019 shows that the housing market is healthy, which is an effect that spreads across the American economy.