The retail industry is no stranger to constant change, intense pressure, and high turnover, but the last few years have tested even the most battle-hardened among us. Today, a shortage of qualified talent — and the competition for it — is creating a serious employment crisis, and it’s heating up just as retailers are staffing up for the all-important holiday season.
Recruiting has always been a full-time, year-round initiative in the retail industry, but the Great Resignation has heightened the stakes and brought these workforce challenges into sharper focus. While retailers added 15, 400 jobs in June, that notable gain isn’t enough to make up for the huge deficit in May, when the sector shed almost 61,000 jobs.
In Deloitte’s 2022 Retail Industry Outlook, 70% of retail executives said they expect labor shortages to hamper their business’s growth. The biggest concern is in the stores, with 74% of executives expecting shortages in customer-facing positions.
Recruiting is a challenge for retailers in the best of times, especially considering the industry’s high turnover rates. The high-volume hiring required to meet seasonal demands makes things even tougher. Not only do leaders have to be able to find the right fit to represent the brand (and show up every day) during this critical time, they also have to make sure they’re structuring the jobs and the work environment to attract the best talent and retain existing staff.
Where to begin? At MOHR, we view the process through the lens of this formula:
(Job Structure + Training + Boss) x Great Candidate = Best Results
Let’s take a closer look at what you can do to optimize your recruiting, interviewing, and selection strategies in these critical areas to better serve your business year round. We spoke with leaders at several major retailers about what they’re doing in these areas, and they shared some examples of the recruitment strategies they’re focused on to help them attract, develop, and retain talent.
Retail Interviewing and Finding the Right Fit
Most leaders struggle to find and place the right talent because they start recruiting and interviewing candidates without defining exactly what it is they’re looking for. Going with your “gut” isn’t enough, particularly now that the labor market is tighter, customer expectations are higher, and so much hinges on your frontline. The specific skills, experience, and intangibles that the store or business unit needs requires recognizing and prioritizing what’s essential and what’s preferred.
Regardless of the kind of retail business it is, we’ve found that there are three elements of a top candidate, and these are a mix of personal motivation as well as skills and knowledge:
- Natural talent
- Learned skills
- Acquired knowledge
The importance of understanding what the right fit looks like and then being able to ask the right questions and conduct effective interviews within that context cannot be underestimated. Our research shows that skillful interviewers lead to better hires and will decrease turnover within the first 90-120 days.
Paul DeSousa, Vice President Talent Management at Ulta Beauty, says his organization outlines clear roles and responsibilities in the interview process so that potential employees know upfront what to expect and what the job will actually be like. There’s no point hiding the fact that retail, particularly during holiday or other busy seasons, can be high-pressure and stressful. Setting expectations sets people up for success and also helps reduce turnover.
Growing the Retail Talent Pipeline
As finding good candidates has become more of a challenge, many organizations are expanding their search and getting more creative about how they approach year-round recruitment.
“We are casting a wider net for talent using local partners like After School Matters and Dress for Success to build a pipeline,” DeSousa says. “We’re hiring 16- and 17-year-old associates now in select states to measure their impact on attracting talent. We will also be watching retention of these associates closely. And we know we have to be realistic with starting pay and ensure we’re paying competitively.”
Now more than ever, it takes an ongoing, multi-pronged approach to maintain a strong pipeline of quality candidates. And quality candidates don’t necessarily have to tick all the experience boxes if they have the potential to grow with the brand.
“We’re focusing on talent equally as much as experience during the hiring process — can we train someone in a skill they don’t have?” DeSousa says.
Retail Leadership and Building a Talent Magnet Culture
Because “[c]urrent retail workforce structures seem destined to clash with evolving employment expectations,” Deloitte argues that retailers “should consider ways to infuse culture, flexibility, and purpose to hire and retain employees.”
Leaders at Ulta are using their own engagement survey results to understand what drives satisfaction in their building and then ensuring that is a part of the new hire experience as they onboard people. The company is also sharing out all exit interview data with leaders as way to drive improvement in experience in store.
The culture is a byproduct of “how we do things here,” and retail leaders are the ones who set the standard. It emanates not only from leadership policies but also from leaders’ interpersonal skills and behaviors, the kinds of behaviors they reward, their commitment to coaching and developing people, and their empathy and connectedness to their team members’ well-being.
This isn’t “soft” stuff. When leaders build a strong culture, talent notices, and that is tipping the scale for many retailers that have become talent magnets. In a recent interview, Lululemon Chief Technology Officer Julie Averill noted that the culture is what draws candidates to the company. And when culture and values align, it’s a good match for both the company and the employee.
It’s All Part of a Winning Talent Strategy
A good boss, solid training, performance goals/incentives, and a great culture all come from inside the company after the person is chosen. But they’re also what keep the talent pipeline healthy and turnover at a minimum.
Whether you’re focused on staffing up for busy seasons or backfilling open positions, make sure you have a robust strategy in place that addresses the recruitment as well as the retention factors that are so critical to your business today.
Become a magnet for retail talent by equipping your leaders with the recruitment, interviewing, and talent selection skills and strategies to make recruiting part of everyday leadership — and widen the pool of candidates throughout the year. Learn more about our retail recruitment training solutions.