As the holiday season approaches, the retail landscape is facing a notable shift that could signal a more subdued shopping experience than in years past. Recent reports indicate that seasonal hiring in the retail sector is set to decline to its lowest level since the Great Recession of 2009. According to Challenger, Gray & Christmas, a prominent job placement firm, retailers are expected to add fewer than 500,000 seasonal positions in the last quarter of 2025. This figure represents an 8% drop from the previous year and is the smallest seasonal gain in 16 years.
Andy Challenger, a senior vice president at the firm, attributes this downturn to a combination of factors including looming tariffs, persistent inflationary pressures, and a growing reliance on automation and permanent staff. “Seasonal employers are facing a confluence of factors this year,” he noted, underscoring that many companies are opting for “doing more with less.” This sentiment is reflected in the hiring strategies of major retailers. For instance, while Target hired 100,000 seasonal workers last year, it has shifted its approach this year by offering additional hours to existing employees and utilizing its “On-Demand team,” which consists of around 43,000 staff members who fill shifts as needed.
This cautious approach to hiring is echoed across the industry. Retail giants like Macy’s, Burlington Stores, Aldi, and 1-800-Flowers have yet to announce their seasonal hiring plans, a stark contrast to the previous year when such announcements were commonplace. This year, companies like Amazon and UPS are expected to provide their hiring figures later in the season, while Spirit Halloween and Bath & Body Works are among the few to have publicly stated their seasonal employment goals—Spirit is aiming to hire 50,000 workers, matching last year’s count, while Bath & Body Works plans to bring on 32,000, a slight decrease from 32,700 last year.
The broader economic context paints a grim picture, with the job market showing signs of strain. In August, nonfarm payrolls expanded by only 22,000—significantly below the anticipated 75,000 and a marked slowdown from prior months. This sluggishness has contributed to the Federal Reserve’s recent decision to cut its key interest rate, an attempt to stimulate growth amidst mounting economic concerns.
Consumer sentiment has also been affected, with shoppers reporting plans to spend 5% less on holiday gifts, travel, and entertainment this year, marking the first significant drop since 2020, as noted in a report by PwC. Likewise, AlixPartners predicts a lackluster growth rate of 3% to 5% in holiday retail sales, further emphasizing the cautious atmosphere as consumers grapple with high inflation, elevated interest rates, and record credit card debt.
As the holiday shopping season draws near, the muted hiring announcements and the overall economic climate suggest that retailers may need to brace for a challenging period. With consumers increasingly wary of their spending habits and companies adapting their staffing strategies to a new economic reality, the upcoming months could redefine the dynamics of holiday shopping in ways that are yet to be fully understood. Retailers and consumers alike will need to navigate these complexities, making it more critical than ever for businesses to innovate and find ways to engage shoppers in a landscape that is rapidly evolving.
