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Retail woes revealed in numbers | TribLIVE.com
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Retail woes revealed in numbers

The Washington Post
| Saturday, February 9, 2019 7:01 p.m
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Until this month, it seemed as though U.S. retail employment had recovered from its apocalypse — the wave of store closures headlined by last year’s implosion of Toys R Us — and was nearing another record high.

Then came the latest jobs report.

Upon further review, the Labor Department revealed in its annual revisions, there were about 138,000 fewer retail industry jobs in 2018 than previously thought.

We now know American retail peaked in January 2017. Instead of adding about 40,000 jobs over the past two years, as we had believed, the retail sector lost about 105,000 jobs. It’s the biggest revision in any industry this year.

The initial jobs numbers are based on some of the biggest and most reliable surveys in the world, but even those must be adjusted each year based on slow-to-arrive data from the Quarterly Census of Employment and Wages, a Labor Department program that counts almost every business in the country.

Critics on both sides of the aisle have questioned the accuracy of the oft-revised jobs data. Ahu Yildirmaz, research chief at the private payroll processor ADP, ruled out any suggestion that the numbers are systematically erroneous or manipulated for political reasons.

“All surveys, all the (Labor Department) reports have a very strong methodology behind them,” Yildirmaz said. ADP data show a similar trend. Revisions, which have happened across administrations and decades, are a normal part of the process, she said.

John Stewart, a Labor Department economist, said, “There’s no bias in our benchmark process or in our estimation process.”

Retail’s decline over the past two years can be blamed on struggling department stores such as Sears, Macy’s and J.C. Penney as well as declines in warehouse clubs, office-supply stores, clothing stores and electronics retailers, said Mitch Nolen, a retail expert whose tweet inspired this article.

Michael Mandel of the Progressive Policy Institute said, “Department stores have taken a big hit over the last 10 years, but a lot of that seems to be a big shift within brick and mortar.” It’s a “shift from Macy’s to Walmart,” he said.

Using categories similar to those Mandel developed, we see that the approximately 119,000 jobs lost by brick-and-mortar retailers over the past two years are dwarfed by a gain of 311,000 jobs in Internet-commerce-related industries. Those include online retailers, delivery drivers and couriers, and warehouse workers.

Those jobs are the modern equivalent of point-of-sale retail, Mandel said. And they tend to pay more than jobs in grocery stores, clothing stores, gas stations, department stores and other retail categories.

A separate Labor Department release shows that retailers were laying off employees at precisely the same rate as other businesses in November, the most recent month for which data are available. That isn’t what you’d expect from an industry in the throes of an apocalypse.

Declining retail employment may also be the result of a thriving economy, said Harris Eppsteiner, a Harvard Ph.D. candidate who was on the staff of President Barack Obama’s Council of Economic Advisers.

“Retail jobs aren’t great jobs,” Eppsteiner said. “We’re at a stage in the expansion where workers have a lot of bargaining power.”

Categories: Business | Wire stories
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