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Retailers in Search of Workers

January 31, 1988

NEW YORK (AP) _ ″Help Wanted,″ reads the yellowing sign that was posted in the store window months ago. Another retailer caught by changing American demographics is having a hard time recruiting employees.

It could be a Sears in a big shopping mall or an independent clothing store on a downtown street. They’re both dealing with the same issue: the struggle to find workers.

″I wish I had more help,″ Mike Stepanek, manager of Ryan’s Ski and Sport store in East Hartford, Conn., said recently.

Stepanek said his business is better when he has enough salespeople who know about ski equipment, the store’s specialty.

The problem - which has forced some retailers to bus workers in from other areas - has been around for years, but ″1987 was the year when the ‘Help Wanted’ signs really blossomed,″ said Samuel Ehrenhalt, regional commissioner of the federal Bureau of Labor Statistics for the Middle Atlantic region.

Several factors contribute to the shortage, which affects retailers in many parts of the country.

Ehrenhalt cited one: ″Unemployment has come down, which means there are fewer people in the pool of unemployed that are available to be drawn in″ by retailers. Unemployment averaged 6.2 percent last year, down sharply from 7 percent in 1986 and 7.2 percent in 1985, according to Labor Department figures.

Retailers are feeling the impact of that trend.

″The more affluent an area, the greater the difference in recruiting,″ said Keith Robinson, a personnel executive for Mervyn’s, a chain of nearly 200 apparel stores.

Mervyn’s has had hiring problems in the wealthier areas around Los Angeles, San Francisco and Atlanta, where unemployment is relatively low, Robinson said.

Another factor is the phenomenon known as the ″baby bust.″ There are not enough young people to go around, and most retail workers are in their late teens and early 20s.

″There are fewer youngsters today than there were a year ago,″ said Ehrenhalt. ″They’re going to continue going down for several years yet, to the mid-1990s, because we are under the sway of the lower birth rates that began in the early ’60s.″

The number of people between the ages of 16 and 24 is declining by about half a million a year, said Oscar Ornati, professor of manpower management at the schools of business at New York University.

″If you have a pool of the labor force that is shrinking ... it gets harder and harder to find employees,″ Ornati said.

Coupled with that shrinking force is a buoyant demand, Ehrenhalt said.

Labor Department figures bear out that trend. Nationally, nearly 5.42 million people were employed by general merchandisers and supermarkets in December 1987, up 2.6 percent from nearly 5.28 million a year earlier. The figures are adjusted to account for Christmas hiring.

A further complication is wages.

″The retail industry is a low payer, not because they want to be, but because in many cases they have a lot of competition and have to keep labor costs to a minimum and they tend to pay the minimum wage,″ said Ornati.

While the federal minimum hourly wage has stood at $3.35 since 1981, inflation has galloped ahead, eroding workers’ real earnings, he noted.

Sears, Roebuck and Co. and Ames Department Stores Inc., which reported hiring problems in some of their markets, said they’ve raised their wages in some stores to attract help.

″Because of the booming economy and limited work force, all of us are competing for the same job force,″ said Gordon Jones, a Sears spokesman.

Ornati, who studied employment problems across the country, found little difference in their frequency between urban and suburban areas.

″Nevertheless, it is a problem that is less marked in the farm belt of the Midwest,″ he said, ″and it is more marked at the two shores.″

At Ames, with outlets in 18 states in the northeastern quarter of the country, hiring problems occur more in urban areas than in small towns, where there is less competition among employers, said spokeswoman Catherine Leonard.

Worker shortages can cost a retailer in terms of good will with customers, who may be forced to wait on longer checkout lines or for help with merchandise.

That can translate into missed sales, but there are ways to counter staffing problems.

Some of the nation’s biggest retailers have lost workers but not sales because they have increased productivity, said Walter Loeb, a retail industry analyst with the investment firm Morgan Stanley & Co. Inc.

Loeb said that through improved productivity, J.C. Penney Co. Inc. was able to increase its sales after inflation by 3.7 percent over 10 years. The gains were realized even as the company closed stores and pared its work force.

Greater productivity can be achieved partly through careful scheduling of employees, Loeb suggested. Use of new technology can help, too. At Toys R Us Inc., ″They added more productivity through greater use of bar-code scanning,″ he said, referring to high-tech cash registers that help retailers keep track of inventory by computer instead of by hand.

Ornati offered several suggestions to stores seeking help, including increased use of elderly workers and part-timers.

″I would reach out to women heads of households by helping them with child care,″ he continued, and suggested retailers ″adopt a high school″ to find teen-age workers.

An all-out recruitment effort was highly successful for Millie McCall, manager of a Mervyn’s in San Rafael, Calif. that used to have a chronic worker shortage.

″We were real aggressive in terms of going to retirement centers - anything to do with senior citizens,″ she said. ″We went to the colleges and high schools.″

She got her staff involved, holding a contest with a free dinner and movie tickets going to the employee who brought in the most referrals.

Now, Ms. McCall said, there are ″Help Wanted″ signs in nearby stores, but ″I’ve had so many customers come up to us and say they want to work for us.″

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