While Canadian retailers continue to announce store openings, expansion plans, and healthy consumer demand in many retail categories, retail employment trends are moving in the opposite direction, creating growing questions about whether retailers are quietly redesigning their operations to function with fewer employees.
Statistics Canada reported that employment in wholesale and retail trade declined by 27,000 positions in April, following a similar decline in March. The back-to-back declines came despite ongoing retail expansion activity across the country and continued investment in stores, shopping centre redevelopments, and new retail concepts.
For Suzanne Sears, founder of Best Retail Careers Canada, the imbalance no longer makes sense.
“We continue hearing about expansion, growth, and strong performance, yet retailers are still reducing staff,” Sears said in an interview with Retail Insider. “Something about the numbers simply doesn’t line up.”
The situation is becoming increasingly difficult for retail staffing professionals to interpret. After years of industry discussions around experiential retail, elevated customer service, and the importance of physical shopping environments, many retailers now appear to be operating with leaner staffing models while continuing to invest heavily in brick-and-mortar growth.
Retail Employment Weakness Continues Despite Store Investment
Statistics Canada’s April labour report showed continued weakness in wholesale and retail trade employment, following another sizeable decline the previous month. Ontario posted the largest provincial employment decline overall, while unemployment in Toronto climbed higher than many expected for a city traditionally viewed as Canada’s economic engine.
At the same time, many retailers continue publicly discussing expansion plans, new locations, and long-term investment in stores.
That widening gap has raised broader questions around what may be changing inside Canadian retail organizations.
Sears said retailers may be attempting to operate more efficiently while simultaneously protecting profitability amid economic uncertainty. However, she believes there are limits to how far staffing reductions can go before consumers begin noticing changes to the in-store experience.
“Every time you lose a sales associate, the level of service in your organization goes down,” Sears said. “At some point, you start weakening one of the biggest advantages stores still have over online shopping.”
The concern carries broader implications for an industry that has spent years positioning physical retail around experience, service, curation, and customer engagement. Those strategies become increasingly difficult to sustain without experienced staff on the sales floor.
“You go to a store for the service and the visual impact,” Sears said. “If customers stop getting that one-on-one interaction and expertise, eventually they may start asking why they are shopping in-store at all.”
Leaner Retail Operations May Be Becoming Structural
The employment declines are raising broader questions about whether Canadian retailers are moving toward permanently leaner operating models.
While some staffing reductions may reflect caution around the economy, Sears said the changes increasingly appear structural rather than temporary.
Part of the shift may involve growing pressure on retailers to improve productivity while controlling labour costs. Some companies have also invested heavily in automation, centralized operations, self-checkout systems, and digital infrastructure over the past several years.
Artificial intelligence may also be beginning to affect portions of retail operations, though Sears said AI alone does not fully explain the employment declines.
Beyond store-level staffing, Sears said she has also seen growing reductions within retail marketing departments, including senior-level positions.
“I’m getting a lot of those resumes,” she said, referring to experienced marketing professionals entering the market.
Some retailers may increasingly be relying on outsourcing, fractional support, automation, and leaner internal structures instead of maintaining larger corporate teams.
Still, Sears believes the broader retail labour picture remains difficult to fully explain.
“Retailers are still opening stores and growing, yet staffing keeps moving in the opposite direction,” she said.
Canadian Retail Staffing Trends Diverge From the United States
Part of the uncertainty comes from comparisons with the United States, where retail hiring activity has remained considerably stronger.
Sears noted that American retail employment has continued growing alongside warehousing and transportation hiring, sectors that often move together as consumer demand rises and supply chains expand.
In Canada, however, the relationship appears far less clear.
The divergence has raised broader questions around whether Canadian retailers are becoming more cautious with labour spending, facing different productivity pressures, or responding more conservatively to economic uncertainty than their American counterparts.
“We’re going in the wrong direction,” Sears said when discussing the widening gap between Canadian and American retail staffing trends.
Older Workers Gain Momentum While Younger Talent Pulls Back
One notable area of employment growth has been among older Canadians.
Statistics Canada reported employment gains among workers aged 55 and older in April, including increases for both men and women.
Sears said many employers increasingly appear to value stability, experience, and long-term reliability amid continued labour pressures.
At the same time, she believes younger workers are increasingly questioning whether retail offers a sustainable long-term career path.
“A lot of younger workers are walking away from retail,” Sears said. “They don’t necessarily see the same long-term opportunities that previous generations saw.”
Years of restructuring, store closures, layoffs, and changing expectations around retail work may be contributing to that shift.
Hudson’s Bay Aftershocks Continue Affecting Retail Labour
Although Canada’s retail employment environment has stabilized significantly since the closure of Hudson’s Bay Company stores last year, Sears said some sectors continue experiencing lingering effects.
She pointed specifically to fragrance and cosmetics professionals, many of whom have struggled to find equivalent employment opportunities following the department store collapse.
“There’s still a large amount of talent in the beauty sector that hasn’t found comparable replacement employment,” Sears said.
Unlike European markets that support larger numbers of standalone beauty boutiques and mono-brand cosmetics stores, Canada’s beauty sector has historically relied heavily on department stores and major drugstore chains, limiting opportunities for displaced workers seeking similar positions.
The category has historically depended heavily on in-person expertise, product knowledge, and long-term customer relationships, making those positions particularly difficult to replace elsewhere in the market.
The situation reflects how the collapse of large department store networks can continue affecting retail labour markets long after stores close, particularly in highly specialized categories built around service and customer engagement.
Questions Continue Building Around Canadian Retail Hiring Trends
Despite the employment declines, the broader Canadian retail environment does not currently resemble a traditional retail downturn.
Consumers continue shopping in stores, retailers continue investing in physical locations, and major retail developments continue moving forward across the country.
That is precisely why the labour numbers have become increasingly difficult for many industry observers to interpret.
“There’s a real disconnect right now,” Sears said. “The industry still talks about growth and expansion, but the staffing trends tell a very different story.”
The assumption you’ve made here is that the in-store experience is the same as it was 5 years ago, which isn’t the case. Online shopping has taken a big share of the shopping experience and people want that brick and mortar store around if they need something quick and can’t wait for shipping, or if they need to exchange for a different size. While companies brag about experiential and elevated customer service, real life would indicate the opposite, as machines replace humans in fast food establishments and self-checkouts replace cashiers. Part time work is also replacing full time work. Gen A and Gen Z shop differently from their predecessors (I have one of each so I am in tune with their shopping habits). What I value as good customer service as a Gen X is not what my kids value. The online experience has to be top notch. It lures them in. The brick and mortar experience is for quick purchases and they better have good size allocations and varieties to get those size exchanges taken care of without having to wait.
exactly.