Littler: Layofffs not widespread in retail

Big layoffs have not hit the retail industry.

That’s according to a survey of in-house lawyers, C-suite executives and human resources professionals across industries by Littler, the world’s largest employment and labor law practice representing management. In the survey, 21% of retail and hospitality industry respondents said their companies have conducted, or are conducting, workforce reductions or layoffs, compared to 24% of all respondents and 60% of tech industry respondents.

But while a quarter of all respondents (24%) say they have implemented workforce reductions layoffs or are in the process of doing so, the more interesting finding may be the lack of layoffs, the report noted. Six in 10 respondents say they are not planning or even considering them — and 50% of respondents say they are either currently, planning on or considering growing their workforces.

“Our survey finds some companies trying to avoid layoffs in favor of measures that maintain the stability of their workforces, as well as employers continuing to focus attention on keeping employees engaged and retaining talent,” said Terri M. Solomon, shareholder at Littler.

The high percentage of employers avoiding layoffs could reflect lessons learned from the pandemic and a fiercely competitive talent market.

“During the first few months of the initial COVID-19 outbreak, thousands of employers engaged in mass furloughs or layoffs due to business shutdowns,” said Solomon. “Many employers have clear memories of being short-staffed and unable to hire up again quickly when businesses began to reopen in mid-2020.”

With regard to company size, more larger employers have conducted layoffs (36%) than their smaller counterparts (14%), as well as hiring freezes (28% versus 16%, respectively).

Impact of Economic Uncertainty

Littler’s “Employer Pulse Survey Report” also revealed the impact of mixed messages about the economy — from persistent inflation and headline-grabbing layoffs to a 53-year low unemployment rate — are having on workforce management and planning. 

While 76% of employers surveyed expressed a high level of confidence in the current state of their own businesses, respondents are worried about how the uncertain economic outlook and/or a potential economic downturn will impact their workforce management and planning.   More than three-quarters (77%) of respondents expressed concern on that front – either to a large (22%) or moderate (55%) extent.

Technology industry respondents expressed more concern than any other sector, with 87% concerned to a large or moderate extent (30% and 57%, respectively). Retail and hospitality respondents weren’t far behind — 82% expressed a large or moderate level of concern about how the uncertain economic outlook will impact their workforce management and planning.

The full Littler survey report is here.