Here’s How Target and Kohl’s Are Preparing for the Holidays
Target Corp. (NYSE:TGT) announced that it will hire 70,000 seasonal workers for the holiday season, a figure that’s down 20 percent compared to last year, according to the Associated Press. In 2012, the store hired 88,000 seasonal employees.
The retailer said it made the decision after realizing that many of its current employees prefer to pick up extra shifts around the holidays. Target employees who choose to do so can increase their working hours between 5 percent and 10 percent compared to holiday season one year ago.
“We’re getting smarter in terms of anticipating how many resources we need when guests are really going to be shopping the hardest,” Jodee Kozlak, Target’s executive vice president of human resources, said to the AP.
The announcement comes after Target posted disappointing second-quarter earnings at the end of last month. Retailers are still experiencing the struggles of the recession even as employment and the housing market recover. Wal-Mart Stores (NYSE:WMT) and Macy’s Inc. (NYSE:M) also saw earnings that revealed consumers are reluctant to spend outside the bare necessities. Target cited “softer-than-expected sales trends” as the reason for the lackluster results and cut its full year forecast.
Kohl’s (NYSE:KSS), on the other hand, doesn’t seem so worried. Kohl’s said it’s increasing the number of seasonal employees it will hire for the holiday season. The company is hiring 53,000 seasonal employees, slightly more than last year, according to the Los Angeles Times. That figure includes 40 associates for each of Kohl’s 1,158 stores, 6,400 employees at its distribution centers, and 350 credit operations personnel.
In Target’s earnings report, CEO Gregg Steinhafel said the company is expecting U.S. shoppers to keep their spending limited “in the face of ongoing household budget pressures.”
According to a preliminary report from Thomson Reuters/University of Michigan, consumer sentiment dropped to 76.8 this month, plunging from August’s figure of 82.1 and giving the lowest reading since April. Given that data, Target seems to have the right idea by erring on the side of caution, though it’s uncertain why Kohl’s has such bullish expectations.
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