Survey: Store employee turnover down; average hourly start rate $15 or under

The current economic environment is causing changes in retail employee turnover and shifts in the way retailers are hiring.  

That’s according to a new survey by global organizational consulting firm Korn Ferry of more than 100 U.S. retailers in which nearly a third of respondents (30%) said turnover among hourly store employees is down 10% or more from the previous year. The survey also revealed average compensation rates for store employees.

In survey findings, a third (33%) reported they have restricted new position hiring, replacing only for turnover. That’s about double the figure from 2022, when about 18% percent said they were restricting new position hires and replacing just for turnover. 

In 2022, nearly three-quarters of respondents (72%) said they were hiring for new positions in addition to replacing for turnover. That number fell to just 55% this year.  

“Both retail employees and employers are being more cautious as we head into the holiday season,” said Craig Rowley, senior partner and retail expect Korn Ferry. “Retailers are thinking twice about adding new roles, which has employees re-thinking leaving one job in search of another.”  

Wages 

In terms of compensation, the most common national minimum start rates for store employees are $12 an hour and $15 and hour (22% each). Only 3% said their minimum start rate is $16 or more and 25% said the minimum rate is $10 or less.   

While 43% of respondents said they have no plans for a $15 an hour national minimum start rate for store employees, 25% said they already have a $15/hour minimum or higher. 

Distribution center employees fared bit better. Twenty-seven percent of the survey respondents said the the national minimum start rate for distribution center employees this year is $15 an hour. And 23% put the figure at $16 an hour; 17% cited $17 an hour.  

“While compensation is important, it’s only one part of the retention puzzle,” said Rowley. “Even though turnover is trending downward, it’s important to continue to focus on culture to attract and keep valued employees.” 

The Korn Ferry survey of more than 100 major U.S. retailers, with annual revenues between $500 million to more than $20 billion, took place in October 2023.