Dive Brief:
- Amid fears of an upcoming recession, retailers cut 13,000 jobs last month, a 3,225% increase year over year, according to a report from Challenger, Gray and Christmas shared with Retail Dive.
- Overall, the report found that U.S. employers laid off 102,943 people last month, a 136% spike from the 43,651 workers laid off in December and up 440% from January 2022.
- In January, employers announced plans to hire 32,764 employees, particularly in the entertainment and leisure sector, a 58% drop from the 77,630 hires announced in January 2022. Retail employers said they planned to hire 615 employees, down significantly from 5,901 in January 2022.
Dive Insight:
January job cuts in the retail industry came second only to the tech industry, which cut 41,829 workers in January, and accounted for 41% of all layoffs. The top reason employers provided for the cuts was market conditions (86,526), but 5,777 of the layoffs had no reason given.
“We’re now on the other side of the hiring frenzy of the pandemic years,” Andrew Challenger, labor expert and senior vice president of Challenger, Gray & Christmas, Inc., said in a statement. “Companies are preparing for an economic slowdown, cutting workers and slowing hiring.”
Retailers across various categories have been feeling the pinch. Among toy and game retailers, GameStop last month laid off employees related to the closing of its Shepherdsville, Kentucky, distribution center. Toy manufacturer Hasbro just last week announced plans to reduce its global employee headcount by 15%.
Meanwhile, apparel, electronics and furniture retailers have also been shedding workers. In January, Gymshark, Everlane and Stitch Fix all announced plans to lay off some of their employees. Wayfair cut its employee headcount by 1,750 people in January, a move it made after laying off 870 workers in August. Best Buy’s Canada division is also reportedly laying off about 700 workers.
