Employment and Jobs

Rethinking the Future of Retail

November 22, 2017  • Sean McGovern

As the holiday season begins, millions of Americans are flocking to their favorite stores to find gifts for friends and family. While traditionally this meant heading to a mall or other brick-and-mortar locations, increasing numbers of shoppers have been turning to online retailers. The rise of ecommerce, new technologies, and shifting business strategies are disrupting the retail industry as we know it. What does this mean for the 15.8 million retail employees in the United States? To find out, the Aspen Institute Economic Opportunities Program convened a panel with four unique perspectives on the retail industry for a Working in America conversation moderated by Greg Ip, chief economics commentator for The Wall Street Journal.

As the co-founder and CEO of A Few Cool Hardware Stores in the DC and Baltimore areas, Gina Schaefer understands the challenges that small business owners face in the age of the internet. Yet she believes that shoppers will continue to appreciate the personal touch that her employees can provide. When asked what skills she looks for in new hires, she said, “We start with someone who can smile.” Technical skills can be learned during training, but customer service remains a priority.

Larger retailers have turned to technology to improve the customer service experience. Ellie Bertani, senior director of associate innovation at Walmart, said that while technology is often villainized for the loss of jobs of frontline workers like cashiers and stock clerks, it can actually be used to take away some of the least interesting and most onerous tasks that workers do and allow associates to spend more time interfacing with customers, which many find more satisfying. Workers spending more time meeting customer needs in turn allows the company to improve customer service and leverage that competitive advantage in the changing world of retail. To make this reconfiguration of jobs work, employees often need to develop different capabilities. Walmart responded to these changes by building training academies across the country to equip their employees with the skills needed to advance their careers.

Sebastian Vanderzeil, director and global thematic research analyst for Cornerstone Capital Group, predicted that workers with “judgement-based skills” — customer service, marketing, and decision-making for the company as a whole — will become more valuable moving forward. Retail employers who are dealing with the rapid changes in the industry need to stay one step ahead of the curve. One suggestion he made was to offer educational benefits, like tuition reimbursement, to current workers. Vanderzeil also encouraged businesses and investors to take a more long-term approach. While wage increases might temporarily drive down profits, decisions made purely on the basis of cost and savings aren’t always sensible.

The retail industry is the largest low-wage sector in the country. Because of this, decisions made by major players like Walmart have massive repercussions for the workforce. Tsedeye Gebreselassie, senior staff attorney at the National Employment Law Project, wants companies to take a more worker-centered approach to their policies. For example, while jobs in fulfillment centers are applauded for their higher pay, the geographic location and requisite skills needed (like heavy lifting and truck driving) can keep some workers out. Gebreselassie says that employers and policymakers should see the creation of new jobs as an opportunity to reform unethical working conditions.

Despite rising productivity among retail workers, wages in the industry have been stagnant. Like Gebreselassie, Schaefer is a champion of minimum wage increases and fair scheduling policies. She also worked on the movement to “ban the box” in DC, making it illegal for employers to ask if potential hires have a criminal record. Another barrier to employment, especially for people of color, is credit checks. This is a catch-22, as it is difficult to obtain a job with a low credit score but almost impossible to improve one’s score without a job.

Creating more equitable policies for workers will require companies, policymakers, and consumers to look inward and think about the labor practices they are supporting. Rethinking outdated methods and investing in one of the largest employment sectors in the economy can be good for businesses — and for workers.

Employment and Jobs
To Fix the Education System We Need Good Jobs
November 20, 2017 • Maureen Conway