October Seasonal Hiring vs. Holiday Retail Sales

by Risk calculated on 23/10/2022 10:38:00

Every year, I monitor seasonal retail hiring for clues about holiday retail sales. At the bottom of this article is a graph showing the correlation between October seasonal hiring and holiday retail sales.

Here is a graph of retail hiring for previous years based on the BLS employment report:

Click on the graphic to enlarge the image.

This graph shows historical net jobs added in retail trade for October, November and December by year.

Retailers hired about 700,000 seasonal workers last year (using BLS data, not seasonally adjusted) and 224,000 seasonal workers last October.

Note that in the early 1990s, retailers began to hire seasonal workers earlier – and the trend to hire earlier has continued.

The following scatter chart covers the years 2005 to 2021 and compares retail hiring in October with the actual (inflation-adjusted) increase in retail sales (Q4 vs. previous Q4).

Seasonal retail hiring versus salesIn general, hiring in October is a pretty good indicator of seasonal sales. The R-squared is 0.82 for this small sample. Note: This uses Q4 retail sales and excludes automobiles, gasoline and restaurants.

NOTE: Top right dot – with actual retail sales up nearly 10% year over year is for 2020 – when retail sales soared due to pandemic spending goods (spending on services was low).

When the October jobs report comes out on Nov. 4, I’ll be looking at seasonal retail hiring for clues as to what retailers are actually expecting for the holiday season.

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