New York: After one of the toughest years ever, US “brick and mortar” retailers are witnessing a rebound and boosting wages for hourly workers and bonuses for senior executives, according to two separate studies released last week.
Wages have grown for cashiers and retail buyers among others, a sign that a tight labour market is finally translating into base-pay gains for workers at retailers, according to data gathered from millions of US worker salaries by Glassdoor, a job website operator.
A separate study by consultant and executive search firm Korn Ferry showed nearly one-third of retail corporate executives received at least 100 per cent of their targeted bonus, more than double the 15 per cent during the same period in early 2017.
A record number of mid-decade store closures and bankruptcy filings, along with rapid growth of online sales, especially at Amazon.com Inc, led investors to sour on the sector over the past two years. But stronger-than-expected earnings in the previous three quarters from many department stores, bargain outlets and apparel brands have started to turn things around.
Growth for retailers comes as the US economy expanded in the second quarter at its fastest pace in nearly four years thanks to a boost in consumers spending, much of it by the bottom 60 per cent of income earners — a break with a decades-old trend where the top 40 per cent primarily fuelled consumption growth, a Reuters study found.
The Glassdoor study shows wages for retail cashiers in July grew by 5.4 per cent to $28,145 (Dh103,362) from a year earlier and rose 2.1 per cent to $58,090 annually for retail buyers, who purchase merchandise from manufacturers.
“Despite weak hiring ... retail jobs experienced pay gains above the national average, likely caused by the increasing demand for workers who specialise in customer service and integrate more technical knowledge,” Glassdoor chief economist Andrew Chamberlain said in a statement.
Chamberlain said he did not expect wage growth to slow anytime soon as low unemployment spurs competition for workers Korn Ferry senior partner Craig Rowley said the current fiscal year has reversed a five-year trend of fewer executives receiving bonuses. Senior retail executives who received no bonuses grew from 10 per cent in 2013 to 29 per cent last year but have fallen to 5 per cent in 2018, he said.
Rowley said Korn Ferry analysed data from 65 North American retailers, with median annual sales of approximately $5.2 billion.