Toys ‘R’ Us plans to hire 5,000 fewer seasonal workers for the upcoming holiday season, though the toy retailer says the employees it will hire will work more hours on a weekly basis.
Overall, Toys ‘R’ Us announced Tuesday it will bring on 40,000 cashiers, sales associates, and stock crew hires to work at its roughly 570 domestic Toys ‘R’ Us banner stores and distribution centers.
The initial announcement indicates that Toys ‘R’ Us may be placing a smaller bet on brick-and-mortar retailing this year. After all, toy sales at its U.S. stores have slipped over the past several years, including a 5% drop in same-store sales for domestic stores for the last holiday season. While the $18 billion U.S. toy industry posted a 4% jump in sales last year, annual results from Toys ‘R’ Us suggest that the retailer is underperforming. The toy aisle is crowded with aggressive discounting, with many toy-focused “door busters” offered by big-box retailers like Walmart (WMT) and Target (TGT), as well as e-commerce giant Amazon.com (AMZN).
Toys ‘R’ Us says the reason it is hiring fewer holiday employees in 2015 is because it will offer seasonal workers a chance to take on “significantly more hours than in previous years.” Seasonal store employees will average 18 to 20 hours per week in 2015 and up to 30 hours during the peak periods, including the days gearing up to the Black Friday weekend and Christmas. Last year, seasonal workers averaged just seven hours per week and up to 20 hours during peak season. On average, about one in five of the retailer’s holiday workers retain positions after Christmas.
Industry watchers expect an overall lull in holiday hiring this year. Retailers added 755,000 employees to their payrolls in the final three months of 2014, but that figure is projected to stay flat this year, according to outplacement consultancy Challenger, Gray & Christmas. Increased hiring earlier in the year may preclude the need to boost payrolls significantly during the holiday season, said Challenger CEO John Challenger, in a prepared statement earlier Tuesday
“Changes in the way consumers shop are making it possible for stores to meet increased holiday demand with fewer extra workers,” he added.
Shipping giant UPS (UPS) also unveiled its holiday hiring plans on Tuesday, maintaining the same pace of hiring that the company announced last year.