Target expects staff to work 5 million hours of overtime this holiday season

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Target said Thursday it is taking a different approach to staffing this holiday season as it braces for a rush of buyers in stores and on its website: it will cut seasonal hires and give more. hours to existing employees.

In total, the discounter said he expects the store’s current staff – around 300,000 people in total – to work 5 million hours of overtime during the holiday season. That translates to more than $ 75 million in extra pay, he said.

Target still plans to hire around 100,000 seasonal workers, but that’s less than the 130,000 it hired for each of the past two vacation seasons, the company said.

The big-box retailer, which has more than 1,900 stores and approximately 350,000 employees, launched an app this summer that makes it easier for store workers to take an occasional shift. It allows staff to choose hours or swap hours on demand, accommodating other obligations such as parenthood or attending a university course.

“The pandemic has highlighted the flexibility needs of our team members,” said Target Human Resources Director Melissa Kremer.

Retailers, including Target, are gearing up for a holiday season that should be both busy and fraught with complications. Sales in November and December are expected to increase by at least 7% year-on-year, according to three different forecasts from Bain & Company, Deloitte and Mastercard SpendingPulse. However, industry analysts say customers should expect to see fewer offers, more stockouts and shipping delays as supply chain challenges fueled by the pandemic spill over through the world.

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Staffing has also become a major challenge, as many struggle to fill vacancies and retain workers – an issue that could translate into more empty shelves, more neglected stores, longer queues. long and other frustrations.

Korn Ferry, a talent consultancy firm, earlier this month surveyed 176 U.S. retailers to see if companies were having difficulty hiring, and just 2% said that was not a problem.

When asked what measures companies are taking before the holidays to increase their workforce, 74 companies said part-time workers are encouraged to take overtime; 63 said full-time workers were encouraged to work longer shifts; and 34 retailers said store hours were reduced. Only 15 companies said staffing Korn Ferry was not an issue.

Target’s Kremer said the strategy of providing more hours to existing staff is part of a larger campaign to attract and retain high-quality workers. She highlighted a multi-year effort to raise Target’s minimum wage, which began before the pandemic. The starting wage of at least $ 15 an hour went into effect in July.

This fall, Target also launched a Debt-Free Education Assistance Program, which covers tuition and helps graduate programs. Walmart already had a similar program and Amazon recently announced the creation of its own. Many retailers have also increased their wages.

Target store manager Mark Schindele said the company has listened to employees and tried to accommodate their preferences. He said many had asked for overtime and more stable hours, which in some cases qualified them for health insurance and other benefits. Another group was looking for more flexible jobs, so they could juggle childcare, college classes or other aspects of life.

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On average, he said, hourly employees work almost 15% more hours than a year ago.

Kremer said that over the past two years, revenue has fallen to its lowest level in five years. The company declined to specify that rate, but said revenue is slightly higher this year compared to 2020.

Schindele said around 24,000 staff are “on-demand” – a pool of part-time workers that he says will grow.

Craig Rowley, senior customer partner at Korn Ferry and responsible for the company’s retail practice, said he recently spoke with a number of retail companies who claimed to have less difficulties in hiring workers on a permanent basis, but it was much more difficult to attract seasonal help.

This is due to a number of factors, Rowley said, but in large part because many Americans have plenty of cash and don’t need to do any extra work to be able to afford gifts for loved ones.

“I don’t think you will see stores open until midnight or one in the morning on this holiday when they can’t recruit staff,” Rowley said. “Getting people to work during the day is hard enough, and getting people to work at night is going to be even more difficult.”

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Still, a number of retailers set ambitious hiring goals ahead of the holiday rush.

Macy’s said it aims to recruit 76,000 full-time and part-time workers at its stores, call centers and warehouses, marking a return to the department store chain’s pre-pandemic seasonal hiring levels. . About 48,000 of those jobs are specific to the holiday season, the company said, while the rest are intended to be extended permanently.

Kohl’s hopes to recruit around 90,000 seasonal workers. The company said it offers a one-of-a-kind bonus, ranging between $ 100 and $ 400, for all hourly vacation employees.

Walmart has yet to announce seasonal hiring plans, but said it is seeking 20,000 employees for permanent supply chain positions, such as material handler and order picker.

But according to Joel Bines, global co-head of retail practice at consulting firm AlixPartners, it’s hard to count exactly how many of those positions end up being filled.

“We don’t have good accounting of the companies that have said [they] wanted to hire 100,000 seasonal workers. Well, how many have you hired? ”He said.

He also doesn’t think it’s a smart strategy to rely entirely on a retailer’s current workforce, as online orders pour in and shoppers pile into stores.

“You will absolutely deplete your existing workforce if you don’t prepare,” Bines added. “Vacation is an eight to 12 week season.”

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