Is seasonal hiring just a cheap date?

Bernice Hurst grew up in New York City, but has lived in England for the past 40 years. Her return trips — now a mixture of business and pleasure — often trigger trains of thought on the way things have (and haven’t) changed in American retailing.

In California on December 19, more than one big department store displayed big signs advertising for seasonal staff, this less than a week before Christmas.

Wondering when the season actually ends, a local speculated that holiday returns and post-holiday sales were all part of the season which presumably then merges seamlessly into the next season, at least as far as retailers are concerned. Perhaps this enables them to avoid taking on permanent staff with all the additional costs that entails.

The economy is said to be improving, with more people having more money to spend and more retailers needing more staff to both sell and fulfill orders. With more jobs available, that potentially initiates a virtuous circle.

FedEx, USPS and UPS are amongst carriers expecting seasonal staff to become permanent. Amazon, Walmart and Jo-Ann Stores are notable amongst chains who hold on to staff, as are retailers needing people in their distribution centers. Seasonal could, in those cases, equate to training or trial periods.

Serial seasonal employees are gaining skills from which their next employer could benefit. Effectively paying someone to train and letting them move on to another, perhaps competitive, retailer may not be wise or cost effective, however. Knowing when to hold on to an employee, calculating the return on investment they could represent in increased sales, isn’t necessarily an easy calculation.

macys holiday hiring

There are other questions. Are retailers taking advantage of desperation amongst those who can’t find work in other fields? Are they thereby benefiting from skills acquired in pursuit of other professions? Do such employees provide a better level of customer service or are they frustrated at taking on work different to their initial preference?

Can seasonal employees be transformed into permanent employees, to everyone’s mutual satisfaction? Or are they just a cheap date? Indications that a greater proportion of seasonal jobs will become permanent offer hope to one and all that that virtuous circle may not be out of the question.

BrainTrust

Discussion Questions

Are seasonal staff a better alternative to permanent staff at retail for employers? How do you view the strategy of holding on to seasonal staff to create permanent positions?

Poll

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Paula Rosenblum
Paula Rosenblum
9 years ago

This is a very complicated question, even though it doesn’t seem to be.

While retailers bemoan staff turnover, their business models tend to be built around the economics of a low-paid transient workforce. In other words, no raises are ever necessary, and they don’t work enough hours to qualify for fringe benefits.

Does that mean that they wouldn’t be ultimately better served by identifying, training and retaining the talent that shows up in their stores? No, it doesn’t, but this is how the model has always run.

I think we might be in for a certain amount of change in that model in the coming year. Qualified employees are really necessary for the renaissance in retail stores that is imminent—but that’s just a prediction at this time.

Chris Petersen, PhD
Chris Petersen, PhD
9 years ago

Bottom line: Retailing is a business. A business with increasingly thin margins and little margin for error. Staffing is a variable expense that has to be carefully managed to optimize conversion.

Aside from inventory, labor is the largest operating cost that retailers have to manage. In order to staff stores 12 hours a day, seven days a week, retailers have had to resort to part-time labor and seasonal employees in order to match staffing to patterns of traffic flow. Situational staffing will continue to be part of the seasonality of the retail business.

The game changer is omni-channel and the higher expectations of consumers in terms of store experience. Retailers need to start investing in employees with the talent and skills to differentiate their store experience. Far better and cheaper to screen seasonal staff and retain the best than to start all over from ground zero.

Max Goldberg
Max Goldberg
9 years ago

A trained employee is almost always better than a new hire. The problem in retail is wages. How do retailers expect to attract and retain workers when many don’t pay a living wage? Most employees see retail as a stop-gap measure, not a career. Until retailers address this issue employee turnover will be an issue.

Ben Ball
Ben Ball
9 years ago

“How do you view the strategy of holding on to seasonal staff to create permanent positions?”

As unprofitable.

Mel Kleiman
Mel Kleiman
9 years ago

Everyone seems to think the model is broken. It is not a question of whether we like the model or not. The question is, is the model working? The answer in most cases is yes. How much training do most retail employees really need? They have to be able to work the cash register, stock shelves and be polite to the customers.

Staffing is also one of the few actual cost variables that operations have any control over. Rent is set, utility is set, once ordered inventory is set.

You may not like the model but it seems to work.

Warren Thayer
Warren Thayer
9 years ago

My friend Ben Ball said it best, and gave me my first laugh of the day. This is also nothing new, been going on forever with weird side effects. My ex from 40 years ago (before I upgraded) used to take seasonal jobs, get let go after the end of the season, and file for unemployment, getting it extended time after time. Always blew my mind, and caused some sparks between us. (The worst was yet to come.)

Nikki Baird
Nikki Baird
9 years ago

I have to respectfully disagree with Mr. Kleiman. The “model” does not work. But to be clear, when I say model, I mean the model that Paula talks about: Hiring a transient workforce and letting them go quickly. Favoring part-time and seasonal over full-time and experienced.

So I do believe the model is broken, and here’s why. One, it is not enough to have people who can “work the cash register, stock shelves and be polite to the customers.” That worked fine when the store was the only place you could go to buy products, but that’s not the case anymore, on all fronts.

The “cash register” is no longer a place to take cash. Outside of grocery, transactions are getting more complex, with endless aisle and save the sale, not to mention all of the assisted selling pre-sales activities that need to happen. Minimal training in that environment is a huge mistake.

“Stocking shelves” is increasingly more complex, with sophisticated planograms, pick- and ship-from store, and buy online return to store. Inventory accuracy is becoming critical, and that requires a lot more thought than just shoving a box of goods on a shelf.

“Be polite to customers” is just no longer enough in a store. Store associates need to be customer advocates, who help them achieve their objectives. That doesn’t sound like a $8 an hour job to me. That doesn’t even sound like $15 an hour. Unless you want a future where we just shutter stores or turn them all into big ol’ vending machines where consumers swipe their cards (or wave their phones or whatever) and a product is dispensed, then store associates must play a much different—bigger, more strategic, more customer service-oriented—role than they play currently. Otherwise, why even bother?

Finally, and this is where video analytics and all these other measurement tools that have lately been focused on stores come in, there is an increasing amount of evidence that the more time that store associates spend with customers, the more money a store makes. And I’m hearing case studies where retailers are (strategically) reinvesting labor into stores and getting a huge return on investment. What that tells me is that the pendulum has swung too far: We’ve cut too much labor out of stores, and justify it with the excuse that it has always been that way, which it has not. I agree wholeheartedly with Paula: This year will be a differentiator for the retailers that figure that out—that there is an ROI on reinvested labor vs. those that continue to think that “polite” and “conscious” is good enough. It’s not today, as any retailer’s Facebook page full of customer service complaints will show you, and it’s not going to be in the future either.

J. Kent Smith
J. Kent Smith
9 years ago

Has the seasonal staff model ever been any different? I think what’s changed is the shift from standing in stores selling sweaters to packing boxes and helping with deliveries. Sales fluctuate by sector so without temp staff you’ll be stuck with too many or too few staff. The extent to which any surge in the workforce can be used as an “extended interview” just makes business sense.

W. Frank Dell II, CMC
W. Frank Dell II, CMC
9 years ago

Seasonal labor should be looked at as paid interns. Those that stand out should be offered a permanent position. Those that just put in time should be let go. The problem is, for many retailers a permanent position is just long-term part-time and the employee does not see the difference.

Lee Kent
Lee Kent
9 years ago

I would like to add to Nikki’s comments. The model is not broken, it’s the wrong model for the times. And, the times they are a changin’.

What I believe Nikki is saying and I wholeheartedly agree with, there is a new store in town—and if retailers haven’t figured this out, they better watch out.

For brick and mortar retailers to win in the coming years, the store will take on a whole new model. They will be fulfillment centers. They will be pick-up centers. They will be experience centers. They will be knowledge sharing centers and last but not least, they will take your money though that may be reduced to a tap.

That said, just think about the skill sets that will be required. To be good at many of these jobs will require training and grooming like never before. Retailers will have to start thinking about retention, benefits, and rewards to keep and incent these employees.

But the bottom line is, the new store will be the differentiator that sells and gains customer loyalty. Now what is that worth?

And that is my 2 cents!

Steve Montgomery
Steve Montgomery
9 years ago

Retailers need the ability to adjust staffing levels to meet demands. It would be great if demand were reasonable level for all retail as it is for some segments. Unfortunately, that is not the case, thus the demand for seasonal employees. As noted, some retailers use seasonal positions as sort of a try-and-buy scenario where if the employee makes a favorable impression, they are then asked to stay on.

Having a strong core staff helps even when the need for seasonal employees is present. The core group can train and provide that all important day-to-day support for the newbies amongst the staff.

Craig Sundstrom
Craig Sundstrom
9 years ago

I think Bernice is overthinking this. If there are X million people hired, then there are probably X million—or more—stories, but they can all be summed up by one obvious fact: stores need extra staff, and people are happy—or at least willing—to work. Many of them—students, (otherwise) retired persons—have no desire to stay on, while others might wish to. Some will, some won’t. In short, it’s like every other hiring situation in retail (or any industry): an optimization of sometimes incompatible goals.

Karen S. Herman
Karen S. Herman
9 years ago

Seasonal employment is a good test for both the retailer and the short-term employee, and I do not see seasonal staff as an alternative to permanent staff; seasonal staff is additional support at a busy time.

What’s key here is how the retailer trains and utilizes seasonal staff. If groomed properly, these employees can definitely become a permanent asset, and may bring additional skill sets or diversity to approaching tasks that benefit the business.

Hy Louis
Hy Louis
9 years ago

Its a great way to audition employees. Like test driving a car for a few weeks.