Place the following development under the public service announcement category: retail stores -- including the likes of JC Penney (JCP), Nordstrom (JWN) , Macy's (M), Bloomingdale's (M) etc. -- are expected to add 480,000 to 500,000 seasonal jobs over the next few months, an industry group indicated.
While the September jobs numbers [which indicated an increase in 103,000 jobs nationally] were better than expected, there is no doubt the economy is still facing significant headwinds, National Retail Federation President/CEO Matthew Shay said, in a statement. With the start of the holiday season just three weeks away, the persistently high unemployment rate is expected to hinder consumer demand and impact confidence.
As we look ahead to a holiday season that will send $466 billion into the U.S. economy -- a higher number than the estimated $447 billion cost of President Obama's jobs bill -- it is important to remember what a powerhouse the retail industry is, Shay said. Over the next several months, the retail sector is expected to add up to 500,000 seasonal jobs, which will provide an important injection into the economy that will bolster families' income and help spur economic growth.
U.S: Frugal Consumer Trend
Historically, consumer spending has accounted for roughly 60 to 65 percent of U.S. GDP. However, the onset of the financial crisis led to a change in U.S. consumer spending habits, so much so that some economists argue a new, long-term frugal consumer trend is in place -- and if the trend holds, it would be bearish for the retail sector. Others argue that the frugal consumer phenomenon will fade when the U.S. economy starts creating jobs at better than a 200,000-per-month pace.
An aging population (due to the retirement of the Baby Boom generation and a modest birth rate), the U.S.'s substantially smaller workforce, stagnant median incomes in many job segments, excessive personal debt, and consumption fatigue are other factors that are likely to constrain consumer spending in the decade ahead, economists generally agree.
Job Market/Economic Analysis: The above retail sector job availability represents just modest good news on the labor front, but in a job market as challenging as the this one, investors -- and certainly job seekers -- will take any good news they can get.
Further, there are numerous economic/social benefits from the retail sector's holiday season hiring. Here are two: in addition to the positive impact on U.S. GDP, some of seasonal employees will be hired as full-time employees by department stores/retail outlets.