November retail hiring lowest on record, a victim of inflation and a tight labor market

Seasonal hiring at Long Island retailers slowed last month to the lowest level on record for the month of November, likely a result of two factors: inflation slowing consumer spending, and a tight labor market making hiring difficult.

The sector added 1,500 jobs from October to November, far short of the 5,100 normally created as stores staff up for the holidays, state Labor Department data released Thursday show. 

The retail hiring slowdown coincided with a month-over-month loss in the number of private sector jobs last month, the data show. Overall, the Island reported a net loss of 800 private sectorjobs from October into November, when a gain of 3,300 is the norm. The government sector added 1,500 jobs over the month.  

Retail hiring has likely been influenced by the impact rising costs are having on shoppers, and as a result, the number of staffers stores think they may need,  said Shital Patel, labor market analyst with the Labor Department’s Hicksville office.

“Nationally, retailers have been scaling back their seasonal hiring plans,” Patel said. “That’s mainly due to inflation impacting the consumer. That’s probably been happening locally, as well.”

The National Retail Federation projected that retailers were likely to hire 450,000 to 600,000 seasonal workers for the holidays, below the estimated 669,800 seasonal workers hired last year.

On top of inflation concerns, Patel said the continued tight labor market and competition for workers could be making it harder for some stores to find workers when they most need them.

“It’s very hard to find help,” said Lily Bergh, owner of Little Switzerland Toys & Dolls in Huntington. Bergh, who said she’s previously been able to find extra seasonal staff, said she’s had no luck this year.

Bergh said while she has received applicants, most aren’t a fit for her business. For those applicants that might work out, she said they often ask for pay rates she can’t compete with.

For now, she said she’s relying on family members to make it through the holiday rush. “Help is very hard to get this year,” she said.

While retail hiring has played a part in the Island’s weaker job growth, Patel said the biggest contributing factor has been the continued loss of jobs in what she called “interest sensitive sectors,” namely those impacted by the rapid rise in mortgage rates.

Financial activities, a sector that includes mortgage financing, lost 1,000 jobs last month, a record monthly loss for November.  Construction, another industry reliant on borrowing and the home mortgage market, saw a loss of 2,000 jobs month-over-month — another record loss for November going back 30 years  — compared to a typical decline of 400.

“While the region hasn’t had widespread layoff activity, there has been some announcements from mortgage companies which are typically one of the first industries to be impacted by higher interest rates,” Patel said.

Reverse Mortgage Funding, a New Jersey-based lender, said in a recent state Department of Labor filing that the company – which filed for Chapter 11 bankruptcy on Nov. 30 – would lay off 119 Long Island employees.

At the end of July, RoundPoint Mortgage Servicing Corp., a Fort Mill, South Carolina-based housing lender and servicer, reported to the state that it would be laying off more than 70 Island employees.