Retail spending and employment; Plus, more financial sector firings in the works
"This is the time of year when retail jobs are supposed to be as plentiful as holiday cheer, when stores gear up for the Christmas rush by filling their sales floors with college students, moonlighters and anyone else looking to shore up their income.
"But no one is feeling very jolly this year.
"Faced with plummeting sales and spooked shoppers, retailers have cut back on holiday hiring at a time when their pool of applicants is swelling with those who have been laid off from other industries. About 272,000 retail jobs were open at the end of September, according to government data released last week, down 24 percent from the same month last year. Those numbers are expected to drop further as retailers cut back on opening new stores and close those that don't perform well.
"It's bleak on both sides," said K.C. Blonski, director of travel, leisure and retail markets for consulting firm AchieveGlobal. "Retailers are looking at the cost of adding to their labor pool. The jobs are little and far between."
"Even those who have jobs are not unscathed. Managers at restaurants throughout the Washington region say they not only are reducing staff through attrition, but they are also cutting hours. Some servers say they are getting fewer tips because fewer people are dining out and those who do have become more stingy.
"For Rick and Nina Ivey, owners of 15 Virginia Barbeque restaurants, the contracting economy means a halt in hiring even though a flurry of people in their 30s and 40s have asked about entry-level jobs. For 18-year-old Megan Waters of Annapolis, it means applying at 14 stores before landing a job at California Tortilla. And for a national retailer like Best Buy, it means nearly 1 million applicants for no more than 20,000 seasonal jobs, a 20 percent increase in applicants over previous years.
"The national unemployment rate reached 6.5 percent in October, according to government data, and some analysts are projecting that it will climb to 7.3 percent next year after hovering between 4 and 5 percent for about three years. There were 1,330 mass layoffs during the third quarter that affected nearly 220,000 workers, spurred largely by slowing demand for consumer goods -- and leaving many of those affected to turn to the retail and restaurant sector as they scramble to make ends meet this holiday season."
Meanwhile, reports of big bank layoffs continue to trickle out. Citigroup is planning to let 50,000 workers go through a combination of attrition, layoffs and asset sales. The company has already slashed 23,000 jobs. JPMorgan is also reportedly looking at thousands of job cuts. And other firms, including Goldman Sachs and Morgan Stanley, are already in the process of implementing their own cuts.