As the holiday season approaches, individuals seeking seasonal employment are encountering a shift in the job market landscape. Recent signals suggest a cooling trend, posing challenges for those eager to secure temporary positions during this festive period.
In October, the U.S. economy experienced a 150,000 job growth report from the Bureau of Labor Statistics. According to Julia Pollak, chief economist at ZipRecruiter, that was lower than anticipated and a "substantial slowdown" from the 260,000 monthly average in 2023. However, there is reason for hope. Economists stated that the labor market has historically shown resilience in the face of economic challenges and is still in good shape.
Why Does It Matter?
Employers like retailers, who constantly monitor customer behavior, use the holiday hiring season as a barometer to gauge their sentiment about the economy's overall state at the year's end.
American retailers have expressed intentions to either maintain current levels of seasonal worker hiring or reduce them due to concerns regarding increased labor expenses and possible declines in consumer spending due to inflation, rising interest rates, and depletion of savings.
The Landscape
According to an analysis by global outplacement firm Challenger, Gray & Christmas Inc., U.S.-based retailers have announced adding about 573,000 seasonal positions this year, the lowest since 2013. Job seeker searches for seasonal work on Indeed were up 33% as of Sept. 30 compared to the same time in 2022. Employer demand for seasonal workers was down 8.2%, according to Indeed.
Several major employers, including the U.S. Postal Service and Macy's, have announced plans to take on fewer seasonal workers than last year, and others indicated they will be relying mainly on their regular workforce to meet the increased demand.
"It feels like the labor market has really cooled," Andy Challenger, a senior vice president with Challenger, Gray & Christmas, told NBC News.
The previous two years' slowdown in holiday hiring is consistent with a broader cooling of the labor market. Competition for workers in retail, hospitality, warehousing, and transportation has decreased as companies have slowed hiring, and layoffs have increased over the past year despite low unemployment and steadily rising wages. According to industry analysts, this means fewer options and less competition for pay and benefits for workers who depend on the extra boost to their income around the holidays.
According to Challenger and Gray & Christmas data, companies have announced plans to hire 573,000 seasonal workers, the lowest number since 2013. This is a 60% decrease from 2021 hiring levels. Retailers have been reducing their workforce throughout the year, announcing more than 72,000 job cuts through October- the highest number of layoffs since 2020. In October, they hired about the same number of employees as they did a year ago.
The general uncertainty about what the holiday shopping season will bring amid a flurry of consumer pressures, such as rising credit card and mortgage interest rates, shrinking savings, the start of student loan repayments, and cooling but persistent inflation, is causing the mixed hiring trends.
