(Reuters) -Target said on Tuesday it would hire nearly 100,000 employees for the holiday season, like in the past two years, and start offering discounts for the festive period as early as October.
The plan comes against the backdrop of predictions that sales growth during the crucial holiday period in the United States could be half of what it was last year due to higher prices denting consumer spending and worries of a recession.
A Mastercard report on Tuesday showed U.S. retail sales could rise only by 3.7% for the period beginning November through Dec. 24, compared with the 7.6% growth seen in 2022.
Last week, a report from career consultancy firm Challenger, Gray & Christmas showed that weaker spending coupled with increased labor costs would result in U.S. retailers hiring the lowest number of seasonal workers this year since 2008.
However, Amazon.com on Tuesday announced plans to hire 250,000 workers for the holiday season, higher than the 150,000 it planned to bring in last year.
Retail bellwether Walmart, which is yet to announce its hiring plans for the year, said in 2022 that it would add 40,000 workers in seasonal and full-time roles.
Macy’s said on Monday it would hire more than 38,000 full and part-time seasonal workers, fewer than the 41,000 workers it had announced to hire in 2022.
Target’s holiday hiring numbers have been the same as “retailers who have been facing tough (inventory theft) shrink issues” have been hiring partly also to keep the situation under control, said Jessica Ramirez, senior analyst at Jane Hali and Associates.
Major retailers, including Target, have warned of a hit to profit resulting from inventory theft.
In a bid to draw shoppers, the big-box retailer said it would start offering items under $25 across categories, including apparel, home goods and daily essentials, as well as host a “Deal of the Day” program from October.
The program is in response to similar shopping events at retail giants such as Amazon, which is kicking off its second Prime Day for the year on Oct. 10-11, and Best Buy, which is having a flash 48-hour sale on those days.
Target only has “a small window of opportunity around the holidays” to get discretionary sales through the door, said Sarah Henry, managing director and portfolio manager at Logan Capital Management.
“So staffing up will be critical for them to continue to manage” through the difficult spending environment, Henry added.
(Reporting by Ananya Mariam Rajesh and Deborah Sophia in Bengaluru; Editing by Arun Koyyur and Anil D’Silva)
Comments