America’s Biggest Employer Isn’t Hiring Seasonal Employees This Year. Here’s the Reason Why

Jennifer Calfas
America’s Biggest Employer Isn’t Hiring Seasonal Employees This Year. Here’s the Reason Why

With a new slew of perks, pay, and benefits to lure workers, retailers across the country are pulling out all the stops to lure temporary employees ahead of the busy holiday season.

But not America’s largest private employer.

For the third year, Walmart won’t be hiring tens of thousands of seasonal employees to provide extra support during the holidays. Instead, Walmart is forgoing the long-standing practice in favor of giving it’s full- and part-time employees more hours and opportunities to earn extra cash.

The idea, Walmart says, is to fulfill the wishes of many of its employees. More hours mean more pay, and more pay means more financial security. “Many associates are interested in working extra hours during the holidays,” a Walmart representative told MONEY in a statement.

The shift in focus, not so incidentally, comes amid a seriously tight labor market. Job openings outnumber the number of people looking for them, and unemployment is the lowest it has been in decades.

“Walmart is having a heck of a time just getting ordinary employees. That’s unusual. Usually, they have an abundance of applicants,” says Richard Vedder, a professor of economics emeritus at Ohio University who wrote the 2006 book “The Wal-Mart Revolution: How Big-Box Stores Benefit Consumers, Workers, and the Economy.”

Vedder adds that he believes Walmart made the decision to “score some goodwill and increase retention of regular employees” by offering “a fringe benefit for them.”

More hours are certainly something Walmart employees have been asking for, especially its part-time workforce. “Anything that is going to give folks more hours is always a good thing,” says Dan Schlademan, co-director for Organization United for Respect (OUR), an organization that represents Walmart employees.

That’s because some of Walmart’s 1.5 million employees have felt stuck with part-time hours in recent years, according to OUR. In 2005, about 20% of Walmart associates were part-time employees. Now, 50% of employees are part-time, according to May 2018 research from the labor group. That change, OUR believes, followed a 2005 internal memo that proposed the use of more part-time employees as “a major cost-cutting opportunity,” according to the research.

“They’re only [ending seasonal hiring] because this massive part-time workforce they’ve created is hungry for more hours,” Schlademan says. “It’s a sign that our largest private employer in the U.S. isn’t creating the kind of jobs that people can really rely on.”

Working part-time has been particularly difficult for Madeline Chambers, an associate in North Carolina who has worked to bring her and her two children out of homelessness. “I always wanted to be full-time,” Chambers, who has worked at Walmart for two years, says. “But there’s always an excuse.”

Chambers says she hasn’t yet been made aware of opportunities for extra shifts or hours during this holiday season, but she says she would take advantage of them. Chambers says she and her children live in government-funded housing where her kids “aren’t comfortable.” She wants to be able to move into her own home soon, so earning extra cash is crucial.

Walmart will make extra hours and shifts available to employees as the holidays draw closer, a representative for the company clarified to MONEY. Then, employees will earn their hourly pay — about $11 per hour for most employees earning the company’s minimum wage — and earn time-and-a-half if they hit their overtime hours for their current role. Open hours and shifts will depend on the location, and some stores will still hire some seasonal employees to help manage the busiest time of the year.

But what OUR and some employees seem to want most for the holidays is a higher hourly wage. Long a leader in the retail space, Walmart has introduced a few minimum wage increases over the years — which, in turn, spurred similar pay hikes at its competitors.

The company perhaps faces its biggest test now that Amazon announced it would bump up its minimum wage to $15 an hour for employees starting Nov. 1. While the announcement came with a few important caveats — some Amazon employees will no longer be able to opt into stock options and will lose an incentive bonus program — it did put pressure on other retailers, like Walmart, to increase pay and benefits for its own employees.

“We consistently review where we stand, taking into account many factors, and we will continue to do so,” Walmart said in a statement to a number of media outlets following news of Amazon’s wage hikes.

Correction: A previous version article incorrectly stated it was the second year of Walmart’s holiday staffing plan and identified the Organization for United Respect as a labor union. It’s the third year of Walmart’s revised holiday staffing plan, and OUR is an nonprofit organization.