Ahead of the holiday season, various retail businesses go on a hiring spree. Holiday sales are predicted to jump 9% this year – “yet a growing workforce shortage will serve as a major roadblock to meeting spiked demand,” said Dan Johnston, WorkStep CEO (and former warehouse manager).
Retailers are attempting to overcome challenges with major hiring pushes. Big chain brands like Walmart are declaring they will hire 20,000+ workers. But Dan believes using outdated methods like job boards and temp agencies are coming up short. As a result, retailers such as Target and Amazon are offering higher wages, new incentives, added flexibility, and more. As per Dan’s observation, “new perks are yielding mostly the same poor results.”
The consequences of the workforce challenge will drastically affect the holiday season.
Dan said, “Retailers can expect shortages, delays and empty shelves due to a lack of manpower throughout supplier operations. Consumers can expect sold-out items and higher prices for gifts under the tree.”
We asked Dan if raising salaries and introducing other benefits for retail staff would be effective to attract talent. He highlighted that the core issue is that these perks are still not addressing the #1 turnover driver we’re seeing: lack of career growth. In fact, pay isn’t even in the top five direct causes of turnover.
Attracting & retaining talent for the holiday season and beyond
To attract and retain talent, retailers need to understand what fuels their employees – and what discourages them.
“Gathering feedback from workers to get a true sense of their values in the workplace is key to driving effective change. Throwing money at the issue may get people through the door, but it won’t get them to stay,” said Dan.
Since turnover is a big part of the problem, retailers should invest in retention. Employee engagement is necessary to provide personalised feedback, develop career plans and offer training opportunities for growth. Dan shared, “This is how brands keep their best employees and attract their peers.”
The challenge of engaging the seasonal staff: Old wine in a new bottle
Employee retention has been a growing problem within the supply chain for years, and now, in the pandemic-struck world of work it’s worse than ever, shared Dan.
Hiring through the holiday rush includes too many quick fixes that won’t lead to long-term retention.
Dan said, “Signing bonuses, incentives for early start dates – the effect of these perks wears off. Once it does, employees are left in the same kind of job that they’ve been bouncing back and forth to for years.”
To retain workers gained through the holiday season, companies need to invest in understanding the employee experience. As per Dan’s experience, technology can help close the gap between management and frontline workers and provide a bridge for communication. Once core motivators and drivers for turnover are identified, companies can create a differentiated culture of retention such that employees don’t want to leave.