First-time jobless claims may have plateaued.
The Labor Department on Thursday said first-time claims for the week ended Nov. 13, 2021, totaled 268,000, down 1,000 from a week ago. And although the tally was slightly higher than the expected 260,000 claims, it was still the lowest since the pandemic began.
That could be good news for retailers.
“The impact of the labor shortages are transitory and we expect them to moderate going into the next quarter as well as into the next year,” Adrian V. Mitchell, CFO for Macy’s Inc., said during the company’s third quarter earnings call. CEO Jeff Gennette mentioned the retailer’s minimum wage hike to $15 an hour, effective May 2022. The move “will increase our average total pay for hourly colleagues to about $20 an hour,” Gennette said.
Other retailers reporting third-quarter results this week noted the competitive job market and the need to offer incentives to attract workers, especially during the peak holiday season.
“It’s a very competitive market for talent and we’ve seen the most competition in our distribution centers. We made some permanent wage increases earlier this year, Michael J. Hartshorn, Ross Stores’ chief marketing officer, said Thursday, adding that the company has included holiday pay incentives at its stores and distribution centers.
Ross wasn’t the only retailer that flexed its financial muscle to raise wages for staff.
“In our stores, we’re providing our team members with more pay, flexibility, and reliable hours this holiday season, offering more than 5 million additional hours to our existing team, an investment of more than $75 million over the holiday season,” Target CEO Brian Cornell said Wednesday. The retailer also added another 100,000 seasonal workers to its temporary staff, many of whom might be able to stay on and become permanent after the holidays. Target chief operating officer John Mulligan added that the retailer is offering pay premiums during peak periods at its stores and distribution centers over the holiday season.
Perhaps the best indication that the recent trend in staffing shortages is about to change was an observation by Doug McMillon, president and CEO of Walmart Inc. during the retailer’s third quarter conference call on Tuesday.
“When the stimulus dollars started to go away, the hiring situation changed faster. We saw people come back in a matter of weeks. We were back to being staffed,” McMillon said. John Furner, president and CEO of Walmart US, noted that the company added 200,000 staff members in the last quarter.