Bay Area retailers face new holiday hiring challenges | Crain's Silicon Valley

Bay Area retailers face new holiday hiring challenges

  • Many holiday workers can't afford to live near their temporary retail job sites and must make long commutes via the Muni. | Photo by Jim Watkins

    Many holiday workers can't afford to live near their temporary retail job sites and must make long commutes via the Muni. | Photo by Jim Watkins

  • Retailer J.C. Penney Co. has implemented hiring changes designed to make it easier for minimum-wage temporary workers. | Photo courtesy of JCPenney

    Retailer J.C. Penney Co. has implemented hiring changes designed to make it easier for minimum-wage temporary workers. | Photo courtesy of JCPenney

With holiday spending on a blizzard of gifts, food and decor expected to reach more than $675 billion nationwide this year, businesses everywhere are likely to need more seasonal help than ever before.

The retail industry in California is eight times as large as the state’s entertainment industry, according to National Retail Federation statistics, producing a total of $330 billion in GDP impact. More than 4.7 million Californians work retail jobs year-round, and tens of thousands more are hired every year as holiday help.

Expecting extra staffers in the winter is usually a given. In certain cities, however, the story isn’t the same.

San Francisco’s booming job market leaves it with one of the lowest unemployment rates for a major metro area: 3.9 percent for August 2017. That compares favorably with the national rate for the same month — 4.4 percent, according to the Bureau of Labor Statistics.

Fewer people are looking for jobs in the Bay Area, and those who are on the hunt can’t afford the local high cost of living on just a temporary minimum wage. But if businesses can’t fill these jobs and keep up with store maintenance or delivery during the holiday season, their bottom lines will suffer.

San Francisco’s hourly minimum wage will remain at $14 during this year’s holidays before rising to $15 in 2018. That means most retail workers earn $560 per 40-hour workweek, the equivalent of about $29,000 per year. But seasonal workers are almost always part-time, with unpredictable schedules that swell and fall with the holiday rush.

Such wages make it almost impossible for their earners to live anywhere near where they work. Online real-estate database company Zillow reports that the average two-bedroom home in San Francisco costs nearly $1 million, with the rest of the Bay Area already surpassing that or falling not far behind. Local house prices in general have skyrocketed in the past five years.

Apartment rents have also doubled, and Muni transit fares keep creeping up. So it should come as little surprise that San Franciscans aren’t flocking to low-wage jobs the way they were a decade ago.

As the executive director of Silicon Valley At Home, a policy and advocacy organization that helps increase affordable housing in the South Bay, Leslye Corsiglia works with people from a wide range of incomes who struggle for housing, from minimum wagers to top earners. In just two years of operation, Silicon Valley At Home has seen the harsh reality of the market.

“You have to have a pretty high wage to be able to afford housing here. Two minimum-wage earners don’t come close to being able to afford a place to live here,” Corsiglia said.

To try to ease this reality, retailers are now offering new perks and benefits to their minimum-wage workers.  For example, like other big-name companies such as Whole Foods, J.C. Penney Co. held its first National Hiring Day this fall, despite recent announcements of impending store closures. The retailer received more than 30,000 applicants for its 40,000 seasonal positions across the country.

“To further entice seasonal hires to stay with J.C. Penney beyond the holiday, the company is introducing paid time off for part-time hourly associates beginning in early 2018,” said Carter English of J.C. Penney's corporate communications.

Such offerings may be enough to draw in new retail workers in other parts of the country — but the Bay Area’s tough markets will be a little harder to conquer during holiday seasons for the foreseeable future.

November 16, 2017 - 1:32am