Retailers Hold Back on Hiring as Economic Pressures Persist

A recent survey conducted by Retail NZ reveals that over 60 percent of retailers do not plan to hire additional staff for the upcoming Christmas and New Year period. This finding, based on responses from approximately 350 participants in the Retail Radar survey conducted between July and September, highlights the ongoing challenges facing the retail sector.

According to Carolyn Young, chief executive of Retail NZ, these results reflect a market grappling with tight margins, rising cost-of-living concerns, and subdued consumer confidence. Speaking to RNZ, Young noted that retailers are focusing on their financial strategies, stating, “The reality for retailers right now is they’re looking at their margins, they’re looking at the stock they’ve got to move and they’re thinking, ‘Where can I trim costs or look to be more effective?'”

The survey results indicate a cautious approach to hiring. Only 2 percent of retailers reported plans to significantly increase their workforce, while 12 percent intend to hire, albeit at lower levels than previous years. About 22 percent plan to maintain their hiring at a similar level to 2024.

Despite the hiring freeze, optimism remains among retailers. The survey found that two-thirds of respondents expressed confidence about their future, a slight increase from 65 percent in the same quarter last year. In a previous Retail Radar survey conducted between April and June, 69 percent of retailers were optimistic about their business’s survival over the next year, up from 57 percent in the same period the previous year.

Young emphasized the importance of the upcoming quarter for retailers, stating, “This quarter is the most important quarter in retail—it’s where two-thirds of profits for most businesses in retail are made.” She added that hope for the sale of new stock and Christmas gifts is essential for the industry’s viability.

As retailers evaluate their staffing needs, many are holding off on hiring due to recent restructures or layoffs. Young remarked, “The reality shows, when they’re looking to hire more staff, they’re saying, ‘We’re going to hold off on doing anything like that right now, because we’ve just done a restructure or just let some staff go, so we just have to kind of tighten our belts and see our way through.'”

The findings from the Retail Radar survey underscore the complexities and uncertainties currently affecting the retail industry, as businesses navigate economic pressures while striving to maintain profitability during a critical sales season.