Retailers aren’t looking too eager to hire as economic uncertainty builds.
The industry shed 6,000 jobs in February, the Bureau of Labor Statistics (BLS) reported Friday. The drop was modest, and some of it reflected labor strikes among food and beverage sellers. But the falloff marked a sharp reversal from the month before.
“The declines we’ve seen in retail postings and jobs added have been slow but present,” said Allison Shrivastava, an economist at the job listings site Indeed. “I don’t think we will have big swings or drops, but there could be some slow leaks instead.”
Retailers made 29,500 net hires as recently as January, most of them in the broad “general merchandise” category, but the longer-running trend has been middling. The BLS said Friday that retail employment levels have been basically flat for the past year, despite seasonal ups and downs. ZipRecruiter chief economist Julia Pollak chalked some of that up to e-commerce and automation, “especially the shift to self-checkout,” but acknowledged growing headwinds.
Hiring announcements across the industry fell for three straight years after 2020 before rising again last year, a Retail Dive review of data tracked by the outplacement firm Challenger, Gray & Christmas recently found. But 2024’s level was still 40% lower than 2019’s.
Across all industries, the number of people who want full-time jobs but settle for part-time work jumped by 460,000 last month for a total of 4.9 million, BLS data shows. Many of them are likely cobbling together shifts throughout the retail sector. Friday’s report found the tally of multiple jobholders bounded past 9 million in February, up from 8.4 million the year before.
It’s typical for retail hiring to cool after the holidays, as employers shed the seasonal workers they scooped up for the hectic gift-buying period. And some operators are still staffing up as 2025 gets further underway. Warehouse clubs, supercenters and other general merchandise sellers collectively added 10,000 jobs last month, according to the BLS.
Still, retailers posted hiring gains of nearly 20,000 at the same time one year ago, and analysts say many retailers are preparing for turbulence ahead.
The declines we’ve seen in retail postings and jobs added have been slow but present.
Allison Shrivastava, Economist, Indeed
“We are hearing softer outlooks for next year as companies report earnings,” said Bea Chiem, retail and consumer managing director at S&P Global Ratings. “This is supported by a softer view of the consumer and uncertainties around tariffs and the geopolitical environment. Immigration policies could also impact the labor and wage outlook.”
The retail industry saw sales drop sharply in January. Many consumers have been growing more pessimistic and bulking up their savings while reining in spending. President Donald Trump’s whipsawing trade policies have kept executives guessing about how much additional costs they’ll incur from his tariffs on the nation’s top trading partners. Some retail heavyweights, including Target and Best Buy, are already putting customers on notice that they’ll have to foot some of the bill.
There were indications ahead of Friday’s report that retailers are downsizing. Employers in the sector have announced over 45,000 job cuts so far this year, much more than the roughly 6,700 in the first two months of 2024, according to the latest Challenger report, released Thursday.
Some of the job cuts reflect store shutdowns. Fabrics chain Joann said last month that it’s closing all of its roughly 800 locations after failing to find a buyer. The company reported in January that it employed about 19,000 people, many of them in part-time roles.
Store closures across the industry hit their highest level since the pandemic last year, with one recent forecast warning of 15,000 more in 2025. That analysis, by Coresight Research, found Party City, Big Lots, Walgreens, 7-Eleven and Macy’s have led the way with store shutdown plans so far this year.
Walgreens announced Thursday that it struck a deal to go private, capping a difficult post-pandemic period and recent plans to shutter 1,200 stores. Chiem expects more retailers to turn to store closures, or at least tap the brakes on openings, to save money this year.
“Higher costs, lower labor supply and macroeconomic uncertainties are key themes,” she said.
Announcements of retail store closures are outnumbering openings lately, the real-estate services company JLL found in a report last month. While restaurants and grocery store operators planned more openings than closures, retailers in a range of other categories — from apparel sellers and drugstores to home furnishing purveyors and department stores — all saw the reverse last year and during the first few weeks of 2025.
Not all retailers are faring badly. Walmart has benefited from an influx of wealthier shoppers seeking lower prices, though even the nation’s biggest private employer has warned that it wouldn’t be “immune” from tariff impacts. There are early signs that a turnaround effort at Macy’s — a plan that includes store closures — is having some success. And shares of Gap surged late this week after the brand’s holiday-season results beat investors’ expectations.
But industry experts say many retailers aren’t in the best shape to take on new challenges. Some are still struggling to navigate consumers’ shift toward e-commerce and higher costs from inflation. Meanwhile, steep interest rates have crimped the credit-card financing many shoppers rely on to keep spending.
These concerns, which especially pinch small employers, have preoccupied much of the industry for the past three years running, Pollak noted.
“Now some are also concerned about policy uncertainty,” she said.
