We’re almost there. Though the process has seemed slow and somewhat cumbersome, the rollout of COVID-19 vaccines is now well underway in every province and territory across Canada. Successful administering of its multiple types in numerous clinics throughout the country is allowing communities everywhere to move collectively and consistently toward our goal of reaching herd immunity. In conjunction with steadily decreasing cases reported, it means that we’re that much closer to a return to normalcy, or something like it, anyway. We’ll once again soon be able to gather, assemble and attend events; to enjoy interaction and engagement with our neighbours and communities at large. And, after such a turbulent and uncertain time, it also means that retailers will be able to start reopening their physical spaces to their customers, welcoming them back to the in-store environment that makes the industry so dynamic and exciting. However, according to Suzanne Sears, President of Luxury Careers Canada and retail staffing expert, it seems increasingly likely that their efforts to do so will be stunted in the midst of what she describes as a retail staffing crisis.
“What retailers are going to be facing when they reopen their physical storefronts is the fact that at least 20 to 25 percent of the retail workforce is not going to come back in time to help create a great in-store environment and support the operation in general,” she says. “And, most importantly, they’re not going to return in time to save the fiscal year for most retailers. If you couldn’t sell much of anything between January and June, you’ve really got to hustle now to make up for those lost dollars. And you can’t do it if you don’t have people. I’m seeing it on a daily basis. Requests are coming in for staff from companies and locations that have never experienced a problem in this area before. In Montreal, for example, there are hundreds of vacancies within organizations. The idea of reopening and restarting is to generate income. And you can’t do that without people.”
Retail talent shortage
Recent Statistics Canada data highlights the issue, reporting that the Canadian economy lost 68,000 more jobs during the month of May, bringing the total of jobs lost since the start of the pandemic to 571,000. Given the fact that retail is by far the largest employment sector in the country, the impact of these lost jobs on the industry starts to become obvious for many. But what isn’t so evident to the casual observer, explains Sears, is the scale and magnitude of the impact, which she believes will show up primarily in a loss of sales and productivity for any retailer struggling with the challenge of filling roles within their organizations, which will be exacerbated by something of a multiplier effect.
“When you’re missing staff, you’re missing out on revenue equal to four-times their salary in the sales and products and services they deliver for the company,” she explains. “So, if you’re paying someone $50,000 a year and that position becomes vacant, you’re actually losing out on about $200,000 because of the vacancy. When you multiply that by dozens or hundreds of missing people, organizations will be losing money simply because of a shortage of talent. Some of that comes from lost sales because there isn’t anyone there to sell to the customer. Some of it comes from lost efficiencies in things like the supply chain. And some of it comes from overburdening existing staff who, because another position is unfilled, have to do two jobs at the same time, decreasing their efficiencies. Vacancies hurt organizations. And when the vacancies are this pronounced and widespread, they have the potential to hurt the entire industry.”
Multitude of factors
Sears is quick to point out the fact that vacancies had already been an issue for many retailers prior to the pandemic when fully ten percent of roles within organizations were unfilled. However, events of the past 16 months or so have resulted in a multitude of factors that are each contributing significantly toward the current talent shortage. Impacts of the pandemic have precipitated in many heightened concerns over safety, leading to an exodus from major urban centres and an unwillingness in those living outside of cities to commute for work. In addition, due to a halt on immigration to the country, the number of new Canadians, who fill a sizeable percentage of retail roles, both frontline and support, have decreased year-over-year, falling substantially short of Canada’s immigration targets. And students enrolled in post-secondary institutions have left their campuses, returning home and leaving the supporting part-time roles that they filled.
“All of these factors have combined to create a worrisome population gap for retail in many cities across the country,” she says. “The problem is most challenging in Montreal, Toronto, British Columbia and Manitoba. There just aren’t enough people willing to re-enter the workforce to fill the vacancies left by impacts of the pandemic. But, what’s perhaps even more troubling, posing potentially severe consequences, is the fact that women have been exiting the labour market at an alarming rate. Without full-time schooling and childcare services, many are unwilling or unable to return to work.”
Stability and security
Further Statistics Canada data indicates that more than 20,000 women exited the Canadian labour force between February and October 2020, representing the majority of jobs lost (55%) within the retail, accommodation and food services industries during that time period. Any of the factors lending to the crisis on their own would be cause for concern, says Sears, but cumulatively they are reflective of one of the greatest staffing challenges that Canadian retail has ever experienced. Add to the list some of the fundamental deficiencies within the offering of retail employment, and the challenge becomes even greater.
“The scope of benefits and incentives that retailers offer in order to attract people to the industry has got to improve,” she asserts. “Wages have got to increase and more paid sick leave, among other things, need to be afforded. But, more than anything, retailers need to offer a guaranteed number of hours to work. It’s the number one complaint among prospective employees – the fact that most within retail work a random schedule of hours that’s different every week. It leads to a perspective of retail as an unstable career and not something that’s desirable enough to be involved in. Providing consistency and security will be critical in retailers’ efforts to attract the right talent to their stores.”
Providing a healthy and safe environment
In addition to ensuring the financial stability that job seekers require, allowing them to meet their own budgets and pay for things like childcare, groceries, rent and other necessities, Sears believes that retailers must also provide the security of a safe and healthy environment to work within. Without having achieved vaccine herd immunity, many are not currently comfortable enough returning to the retail workplace. However, going forward, the retail staffing expert offers a way by which retailers can safeguard their physical locations and establish a safe setting.
“Retailers are going to need to demonstrate to prospective employees, in a tangible way, that showing up for work is not going to jeopardize their health or their lives,” she exclaims. “To do this, they’re going to need to implement significant measures in order to offset risk. As a result, employing a fully vaccinated staff is going to be crucial. It’s the issue that retailers are going to be confronted with tomorrow and into the foreseeable future. In order to do this, many will consider making ‘proof of vaccination’ as a term of employment within their organizations. I absolutely believe that this will gain traction within the industry very quickly and will become the way of the modern workforce. It’s really the only way by which retailers or any other business can ensure the health and safety of their employees and customers.”
Innovation and reinvention
As retailers in communities and cities across the country continue their preparations to reopen their operations to the public and reintroduce their offering, the need for many to fill the roles required to execute on their anticipated return is becoming increasingly dire. Sears recognizes the seriousness of the situation, describing the current staffing shortage as a pivotal moment in the near- and long-term future of retail in Canada. She adds that it could serve as a catalyst for real change within the industry, perhaps sparking a bit of much needed creativity in order to attract and retain the best of the best and ensure the continued growth and success of their businesses.
“Most of the jobs that have been lost during the pandemic are supporting part-time jobs. To start refilling these positions, retailers are going to need to invest into modernizing them with more flexible terms and conditions. They’re going to need to innovate and reinvent retail as a viable career again, offering clear paths to opportunity, success and promotion within the company that are easily documented and observable. As part of this, they’re going to need to offer training for their employees and teach them more, which almost always results in heightened engagement and productivity. There are a lot of changes that need to be made within the industry to meet the current challenges. The changes that are required need to come from leadership in order to empower human resources and the rest of the organization. And it needs to happen sooner rather than later, because they’re already fighting the battle from behind.”