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Retail Employment Down 40K in September Sales Appear to Be Off as Well Date: 10/8/2008 |
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Employment in the retail trade dropped by 40,100 during the month of September intensifying a trend that has extended over the past twelve months during which the retail sector has lost over 250,000 jobs. Retail job losses reflected the overall rise in unemployment, which reached 159,000 in September, the highest monthly total in more than five years. As the economy worsened during September it appears that retail sales went south as well. Master Card reports that the decline in sales via its credit cards accelerated during the month. Sales were off 3-4% during the first half of the month and then the declines increased to 6%-7% during the last two weeks of the month as the financial crisis deepened. Retail job losses in September were much bigger than the 28,000 average of the past twelve months, an indication that the economic situation was worsening. According to the Bureau of Labor Statistics the auto sector was especially hard hit. With car sales hamstrung by the tight credit market and Americans driving fewer miles because of higher gas prices, motor vehicle and parts dealers lost 10,800 jobs in September, while gas stations lost 6,000 jobs. Department stores, which have dropped over 70,000 jobs in the past twelve months, lost 11,000 more in September. General merchandise stores made up most of the other losses with a drop of 11,100 jobs. With the holiday sale season approaching retail employment should rebound, but the question is by how much? Since analysts predicting a weak holiday season, the normal seasonal rise in retail employment may be muted over the coming months. While comics, games and movies have often been considered countercyclical, they have been doing well during recent relatively prosperous years, so it remains to be seen how these sectors that dispense ?cheap thrills? (aka ?inexpensive entertainment?) will do if the country slides into a serious recession. Let?s hope we don?t have to find out. |
| Source: ICv2 |
