Decades of retailers neglecting workers, making labor shortages worse

  • A record number of U.S. retail workers are quitting their jobs.
  • Decades of low wages and lack of career development are taking their toll, making labor shortages worse.
  • Retailers need to start offering sustainable jobs again to address this crisis, experts say.

After 15 months of working in a pandemic, Michael quit his job as an employee of a furniture store in Arkansas in May 2021.

He had reached the breaking point. Long guards dragging furniture around the store, uncomfortable customers, inconsistent schedules that made his home life hard, and a rat attack that was not treated for several months in the store had affected his mental health.

Michael, who requested that his last name remain anonymous but whose identity is known to Insider, said he did his best to get along with leaders and supervisors, “but in the end, poor communication, unrealistic expectations and threatening punishment” not to meet certain standards is the end of healthy work dynamics. “

“Unemployment is scary, but I knew there was going to be more to life than this,” he told Insider. “There should be more in life than being shouted at by random strangers. There should be more in life than retail.”

Michael is among thousands of retail workers who have quit their jobs this year in hopes of moving to better paid positions in more stable industries. Since then, he has accepted a new job as a teaching assistant at a primary school, and initially taken a pay cut, which he says is worth it.

While “The Great Resignation” was born out of the pandemic, the emotions behind it have brewed for years in retail. Decades of shops neglecting workers have turned retail work into a CV stop instead of a viable career, experts tell Insider – and it’s now back on track to haunt the industry. Retail and food service have been the sector hardest hit by workers quitting their jobs, and now the industry is facing a crippling labor shortage that became more intense as the holiday season approached.

Big-box stores changed retail work

Before the 1960s, working in retail was considered a solid, sustainable job, Marc Perrone, president of the UFCW, the largest retail workers’ association in the United States, told Insider.

Wages were not the best, but they were not the worst either, he said, and when you include extra benefits – overtime, bonuses, pensions, employee discounts, medical care, disability and life insurance – the workers felt like the future of them and their families was taken care of. It was attractive jobs.

This began to change in the early 1960s with the advent of large stores such as Walmart and Target, whose business model was to offer low prices to customers by keeping labor costs down.

It was also the start of a shift away from full-time to part-time work. Stores realized that they could hire twice as many employees without having to pay overtime or benefits, and they could plan the work of employees according to consumer demand.

A woman in face mask and red T-shirt scans groceries at a checkout counter.

Some retailers see labor as a cost rather than an investment.

Ben Hasty / MediaNews Group / Reading Eagle / Getty Images


This had a huge impact on retail jobs, Perrone said – and for many people, it was no longer possible to live sustainably.

Workers received limited benefits with few or no long-term career opportunities, Mark Cohen, director of retail studies at Columbia Business School, told Insider, adding that staff were “commoditized and somewhat dehumanized as a result.”

Their roles also changed. Workers were hired to stock shelves and drive the checkout rather than being customer service experts, which meant that personal relationships between customers and workers disappeared. Loyalty between employer and employee soon followed. The advent of technology for certain tasks made each individual less valuable.

“There was no need for employee loyalty,” Ed Delaney, a State Representative for Indiana who has fought for workers’ rights, told Insider. “Retailers could just lay off workers and get a new one in,” he said.

Balance of power back to the workers

Now, for the first time in decades, the balance of power has changed and retailers are realizing that they need to address working conditions, wages and career opportunities if they want their jobs to be seen as desirable.

Progress has so far been limited. Some stores have raised wages, while others offer perks such as sign-up bonuses to motivate workers – but this is no guarantee of a stable career or long-term higher wages, according to Delaney. “It’s just, ‘I need you now, and I’m stuck paying you this.’

With thousands of jobs still to be filled, retailers are at a crisis point. “Retail employment should again be seen as a start-up career starter rather than just a low-paid ‘job,'” Cohen said.

Workers who have left the sector will require a lot of convincing to go back. Michael, for example, tells Insider that he would need more than a pay rise.

“The whole retail culture and process needs to change,” he said.

“I can not take the years back in retail and food service that have aged and weakened me,” he said, “but I can go on to know that I do not have to be trapped in that environment anymore.”

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