Labor Shortage has Retailers Leaning on Technology

At the start of 2023, seven in 10 retail executives said the labor shortage was the No. 1 challenge heading into the year. At the time there were nearly two open jobs for every unemployed person in the United States and in January the retail industry accounted for 870,000 of these vacancies, according to the Bureau of Labor Statistics. These numbers show that finding and hiring employees who will stick remains difficult for many retail businesses.

What’s important to job seekers? A 2022 study from PricewaterhouseCoopers (PwC) – the 2022 Global Workforce Hopes and Fears Survey – showed that there were a few key reasons workers were leaving their jobs and looking for new employment. They wanted:

Addressing the desires​

Compensation – The easiest way to address the labor shortage is to offer more money.

The federal minimum wage of $7.25 per hour has not changed since it was set in 2009. However, over the past three years, more than half of the states have increased their minimum wage levels and more than 20 are increasing minimum compensation in 2023.

Talent.com says the average starting retail salary in the United States in 2023 is $15 per hour or $31,200 annually. Most retailers bumped up their starting salaries when keeping good help became a priority in the wake of the pandemic.

Company culture – Creating fulfilling positions, promoting teamwork, and adopting more sensitive management policies make a workplace desirable. Glassdoor surveyed over 5,000 workers in the United States and Europe about what they considered important in an employer. Three-quarters (77%) said they would consider a company’s culture before applying for a position. Astonishingly, over half (56%) said company culture was more important to them than salary.

For small businesses to address the labor shortage and compete with the big-box behemoths for top-notch employees, human resources experts say they should sell them on their company culture and what a great work environment they have. Businesses located in areas with skiing, hiking, biking, rivers, lakes, or beaches can use those resources as additional perks.

Those kinds of activities are also often ingrained in the culture of many small companies that have corporate softball, cycling, or running teams or groups. Some companies organize group ski vacations, trips to ball games, concerts, or festivals to further develop their culture and cohesiveness. Often, it’s not all about cash.

Be flexible – Another way to stand out from the crowd of recruiters is to be as flexible as possible with working conditions.

Retail merchants often hire lots of part-timers to work shifts to cover business hours that run anywhere from eight to 12 hours. While that may work from a management standpoint, it can also create workers who aren’t invested in their employer’s business success. Part-time workers might be working several jobs to make ends meet which usually isn’t good for mental health or company morale.

Full-time employees tend to be more fully engaged in their jobs and ultimately the success of the business. Companies seeking to fill part-time shifts, retirees, disabled individuals, workforce development participants, and other people looking for supplemental income can plug holes in their schedules. It often depends on whether you can make their work hours fit their needs and lifestyles.

Technology works

To compensate for the labor shortage, many retailers are more and more relying on technology for help. Properly used, retail technology can help stores run more efficiently and reduce the dependence on labor.

Ease of use – There’s an old business axiom that within the first six months of work, approximately one-third of a store’s new hires will quit. Setting new hires up for success with consistent processes and the right equipment reduces the chances of losing employees.

 A point-of-sale system (POS) that is easy to learn, teach and use is essential. They also make it easier and more enjoyable for employees to do their jobs.

“A system with a user-friendly interface makes it easy for anyone, even those apprehensive about using a computer, to become productive after minimal training,” says Dan Nesmith, founder and president of Paladin Data Corporation, a leading provider of retail technology solutions.

Mobility matters – More and more retail transactions are being made away from the checkout counter. Mobile point-of-sale (mPOS) terminals gained a lot of traction during the pandemic. In-store customers were hesitant to stand in long checkout lines, so many small businesses adopted mobile POS units to bust lines and create a better shopping experience.

Grand View Research says mPOS terminal market is expected to reach $181.5 billion by 2030. That uptick in use isn’t just for ringing up sales, either. For merchants, mobile point-of-sale systems and use of other mobile devices go way beyond just turning transactions. They can already use the systems to check inventory, place orders, receive merchandise, and schedule and complete deliveries.

Mobility also helps retailers keep track of their stores even when they’re not present. Mobile access to a store’s business network allows store owners and managers to work from home or wherever they can get an internet connection.

Denise Page, who, with her husband Jeremy, runs Lands End Marine Supply in Provincetown, Massachusetts, uses Paladin Pilot to access her business network from home.

Centralized business management – Point-of-sale systems today are much more than sales and inventory management tools. Many provide tools, or integrate with specialty software providers, to simplify e-commerce sales, daily accounting, rental department coordination, customer rewards programs, and workforce management. These tools make it easier to do more work with less effort.

“This has been a labor-saver for me,” explains Dennis Gamble, owner of Tri-County Hardware and Farm Supply in Paxton, Florida, who leans on his system to simplify his sales and bookkeeping. “The way the accountant wanted our paperwork, it was labor-intensive to put together. We put in sales, cash, credit, checks and accounts received by hand, and that better tally up to how much business we have done that day. Now, it’s all done at the front desk. It cut a lot of hours out of my week.”

Upshot

Technology can’t solve all the challenges of the labor shortage, but utilizing all the tools available in a modern POS system can help retailers run their stores more efficiently and effectively.

brian bullock 

Author