As the holidays are now upon us retailers maintain a surprisingly optimistic outlook for the holiday shopping season this year with the National Retail Federation predicting a record-shattering year. Despite pressures of labor shortages and supply chain bottlenecks that are more predominant than ever, they remain hopeful because the majority (88%) predict a rise in year over year store traffic and industry analysts estimate a 7% – 9% sales increase over 2020 holiday results. Although, as stated in our 2021 UKG Retail Holiday Hiring Survey, 88% of retailers are entering this peak holiday season still concerned about burnout and fatigue among store associates and 52% say COVID-19 safety is still their number one priority for the remainder of 2021 and beyond.
Retailers are also expecting in-store fulfillment to be more prevalent this holiday season than in 2020. 88% of retailers expect many customers will still prefer to shop with as little contact as possible which means stores need to be prepared to staff services such as curbside pick-up and ship from store. A startling 75% of retailers said customer expectations are higher than what stores can deliver in terms of service due to the labor crunch. Stores must continually be prepared to change their operations around ever-changing consumer needs.
Advice for retailers
This holiday season retailers are challenged to attract and retain not only seasonal, but full-time workers. According to our survey, 73% of retailers said, “it seems like people don’t want to work in retail anymore”. Employees are still experiencing fears about catching COVID-19 at work, and 32% of retailers say frontline work through the pandemic has been particularly grueling. Employees are looking for higher pay, benefits that are not traditional for the industry, and greater flexibility in scheduling, particularly during the holiday season.
As a result, understaffing and turnover is expected to especially plague stores this season. 83% of retailers agree: It’s more difficult to retain good employees than it is to attract new talent these days. Store managers now more than ever are having to pick up extra shifts to cover shortages along with training and onboarding new hires over the course of the season. Additionally, 78% of underperforming retailers said their stores are understaffed at least once a week, and a not so shocking 94% of retailers agree their stores are “desperate for talent”.
This begs the question of what retailers can do to try and retain and engage their employees. Retailers need to focus on what employees truly care about and invest in store associates for the long term, rather than the short term. Just as we’re discovering across the broader workplace, retail employees want to feel a sense of belonging, appreciation and benefits that prioritize their life-work balance. Bonuses, store discounts, and work perks are great, but retailers need to consider benefits that truly meet their needs, whether in terms of pay, flexibility, benefits, or culture. For example, 54% of retailers are guaranteeing associates a minimum number of scheduled hours per week, providing a level of stability that most employees desire, along with 63% of retailers raising pay for seasonal hires.
Additionally, many retailers (7 in 10) have recognized this and have made direct long-term investments in their people including making work schedules more flexible to empower them to make choices. Lastly, and most important to consider, is seeking feedback from the frontline and taking small steps towards positive change to demonstrate investment in them. People are the differentiators in physical retail. A direct investment in their well-being is a direct investment in customers and the business as a whole.
Advice for shoppers
As retailers battle to overcome more challenges than ever this season, it’s our job as consumers to extend a lot more patience to retail workers. Generally speaking, many shoppers are getting tired of shortages and shortcomings, which poses a challenge as 75% of retailers observe that customer expectations today are higher than what their stores can deliver in terms of service.
As mentioned earlier, a third of retailers (32%) attribute people not wanting to work in retail to the fact that frontline retail work has been particularly grueling during the pandemic and according to RetailWeek, 88% of frontline retail employees experienced verbal abuse during the pandemic. For shoppers this holiday season, it’s imperative we remember to be patient and be KIND with the retail workers who have shown up — because we know that fewer have, and it’s not likely to get much better anytime soon. In fact, understaffing in stores will be hard to avoid this season: 26% of retailers believe they’ll be short-staffed every day. We should appreciate the employees that choose to show up every day and remind them we are thankful, because they are doing their best to ensure you’re served and smiling even though their circumstances are likely not as merry as holidays past.
There is pent up demand and more reason to give to those we love and those in need given another year of challenging pandemic times — which means stores will be busier than ever. This holiday season make sure to stay safe during your shopping excursions, be patient with stores and employees, and don’t forget to thank a retail worker!
For more information check out our full holiday hiring survey here.