December 8, 2025
DragosCondreaW/Depositphotos.com
Will Strong Holiday Spending Curtail Ongoing Retail Job Losses?
A somewhat sobering Challenger, Grey & Christmas report issued Dec. 4 indicated that while retail job cuts had somewhat slowed from their earlier summer peak, as RetailWire previously covered, there was still a great deal of room for concern.
Among the report’s findings:
- In the broadest terms, concerning all employment sectors recorded, employers cut 71,321 positions in November, up 24% from the 57,727 figure recorded in November 2024. However, it was an improvement over ominous October figures seeing 153,074 job losses. “Layoff plans fell last month, certainly a positive sign. That said, job cuts in November have risen above 70,000 only twice since 2008: in 2022 and in 2008,” said Andy Challenger, workplace expert and chief revenue officer for Challenger.
- Retailers announced 3,290 job cuts in November, trending upward from 2,431 job losses in October.
- So far in 2025, retailers have slashed 91,954 positions, up a staggering 139% from the 38,403 job losses recorded in the U.S. retail sector at this point last year. One silver lining: This figure was recorded, at the end of August, at 83,656 (up 242% YoY), meaning that the bulk of the job cuts had been recorded by that time — and that terminations have slowed, in relative terms, in the interim.
These cuts were attributed to retailers “adjust[ing] workforce levels amid softening demand, tariff uncertainty, and changing consumer preferences.” Similar reasoning was provided by Andrew Challenger, SVP and jobs expert for Challenger, around August’s report.
“Retailers are being hard hit by tariffs, inflation, and ongoing economic uncertainty causing bankruptcies and closures. If tariffs and consumer spending constraints play out, the approaching holiday shopping season may see fewer seasonal hires and, in fact, high layoffs,” Challenger said as the summer drew to a close.
Will the Seemingly Healthy U.S. Holiday Spend Carry Over Into Next Year, or Translate Into More Retail Jobs?
Against the backdrop of a strong Cyber Week performance by U.S. retailers and consumers — achieving $44.2 billion in spend versus $41.1 billion in 2024, outperforming Adobe Analytics’ expectations, per Reuters — and perhaps resultant optimism over the health of the holiday spend in general terms, a few other conversation topics (and questions) around the longevity of seasonal hires emerge.
Seasonal hires were broken out into specific retailers by the Challenger data, and although the data table was incomplete, it can reasonably be assumed that retail and service industries would capture the bulk of unreported hires. Through November, 372,520 seasonal hires were announced, with the majority of these being attributed to Amazon (250,000, the same as in 2024 and 2023), Spirit Halloween (50,000, the same as in 2024), and Bath & Body Works (32,000, slightly down from the two years prior).
Will these hires see any meaningful rate of retention, though? The answer is unclear, according to Andy Challenger.
“The increased spending over the Black Friday and the Thanksgiving weekend may give rise to hires in December right before the holiday. It’s unclear, however, if those positions will last into the New Year,” he said.
BrainTrust
Carlos Arámbula
Principal, Growth Genie Partners
Cathy Hotka
Principal, Cathy Hotka & Associates
Gene Detroyer
Professor, International Business, Guizhou University of Finance & Economics and University of Sanya, China.
Recent Discussions
Discussion Questions
Will the seemingly strong U.S. retail spend this holiday season translate into any meaningful swing to improve the retail job loss picture in 2026?
In your opinion, have retailers (generally speaking) embraced leaner or lower staffing levels in physical locations as the “new normal”? If so, are bets that the consumer will accept this dynamic paying off?
Poll
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Good holiday sales are better than weak holiday sales for the jobs outlook. But no, this does not signal an end to selective pruning of the workforce and caution in hiring. Sales represent revenue, and the problem a lot of retailers have, with tariffs and a host of other things, is getting this revenue to the bottom line. Margin and profit pressure are one of the key reasons for job losses, and I don’t see this shifting much in 2026.
The only thing that will curtail job losses is retailers finding out they don’t have enough staff to handle things. But there are two problems with this (insofar as those hoping for a reversal are concerned):
1) By the time it would be discovered, the season would be over, and
2) Retailers don’t seem to be interesetd in adequate staffing anyway.
So HO, HO, HO…short answer: No
Reductions in the workforce will continue. Retailers are under huge stress and will continue to cut expenses in any way they can, including shuttering lower-performing stores. As long as financial pressures are sharp, everything retailers have will be on the chopping block.
I think the strong retail spending expected this holiday season may provide a temporary lift, but it is unlikely to meaningfully reverse the broader trend of retail job losses in 2026. While consumer spending may hit new highs (or at least remain resilient), much of that increase is being driven by inflation and price increases rather than a substantial uptick in units sold. Meanwhile, seasonal hiring forecasts remain muted: the National Retail Federation (NRF) projects just 265,000–365,000 new holiday positions for 2025 — the weakest holiday hiring wave in years. Nor do we see broad hiring announcements across major retail chains, suggesting that retailers are viewing this holiday increment as an opportunity to maximize operating leverage rather than rebuild full-time staffing.
Yes — I do think retailers have increasingly embraced leaner staffing levels in physical stores as the “new normal.” After years of pressure on margins, rising labor costs, and a shift toward automation and omnichannel fulfillment, many retailers appear to be recalibrating staffing downward and relying more on efficiency rather than headcount. The bet seems to be that consumers, under continued inflationary pressure, will accept reduced staffing levels as long as prices remain low and convenience remains intact. Whether that bet pays off remains uncertain: customer service, in-store experience, and execution quality may suffer.
In my view, the future of retail employment is rooted in macroeconomic outlook and policy, not in any single strong holiday season. Real improvement in job growth will depend on broader economic stability — especially a reversal of tariff-related cost pressures, inflation easing, and renewed investment in brick-and-mortar execution. Until those conditions materialize, holiday sales spikes may offer transient relief to retailers at best — not a durable rebound for retail employment.
It’s important to recognize that the forces driving this year’s layoffs—tariff policy, inflation, reduced household income, and low consumer confidence—aren’t going away after the holiday season. At the same time, retailers have moved toward permanently leaner staffing models, leveraging AI, self-checkout, and other efficiency-driven tools to stay competitive with fewer employees.
Whether consumers have truly accepted this “new normal” is less certain. Many are dealing with pressures far more disruptive than retail service levels, so what might look like acceptance may be distraction or fatigue. Retailers need to distinguish between genuine consumer tolerance and consumers who are too strained or preoccupied to push back, and plan for step after next.
Exactly.
The harbinger of Black Friday results should be eye-opening. Salesforce reported sales revenue up 7%, but volume down 1%. Those numbers are screaming, “We’ve got a problem.” It seems retail CEOs continue to boast of a wonderful holiday season.
Maybe the boast is for the public, and the reality is they see the need for job cuts?. Do you need more employees if your volume is actually down? Sadly, this was all predictable, and it isn’t going to get any better as non-tariff inventory clears. Does that mean less retail volume? Less disposable income for consumers? Less volume? Is there less need for retail staff?
The bet is YES!
Exactly.
We really need a better framework for discussing sales, to get beyond reacting to PR puff pieces about “strong”, “weak” etc. What does – say – a 2.5% sales increase mean if prices were up 3% ….and population was up 1%?
And that’s just at the aggregate level; at the company level, it’s even more confusing: macy*s was lauded for “increases” that somehow had the Top stores underperforming their average…how? (by including high-flyer bloomingdales); adding to the confusion is excluding what is becoming an ever-growing percentage of discontinued operations.
The math is so easy. Why does everyone seem to ignore it. Per your equation, if sales are not at least 3.5%, they aren’t up. Let’s stop pretending and address reality.
I’m not sure how we read this article, along with all the other news about Black Friday and the consumer environment in general, and call the spending “seemingly strong”. Holiday spending may be one of the most powerful incentives the consumer has all year. It seems more accurate to say that the spending rubber band is about to be stretched to the max during holiday 2025, hopefully not snapping, but pulling back in the first quarter of 2026. Consumer debt and deliquency data are not our friend at this moment. What kind of cheerful, updeat spending motivators, and enablers, await us post holiday? At a minimum, 2026 will have a slow start. Buckle in.
Stretched to the max. I like the analogy.
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Good holiday sales are better than weak holiday sales for the jobs outlook. But no, this does not signal an end to selective pruning of the workforce and caution in hiring. Sales represent revenue, and the problem a lot of retailers have, with tariffs and a host of other things, is getting this revenue to the bottom line. Margin and profit pressure are one of the key reasons for job losses, and I don’t see this shifting much in 2026.
The only thing that will curtail job losses is retailers finding out they don’t have enough staff to handle things. But there are two problems with this (insofar as those hoping for a reversal are concerned):
1) By the time it would be discovered, the season would be over, and
2) Retailers don’t seem to be interesetd in adequate staffing anyway.
So HO, HO, HO…short answer: No
Reductions in the workforce will continue. Retailers are under huge stress and will continue to cut expenses in any way they can, including shuttering lower-performing stores. As long as financial pressures are sharp, everything retailers have will be on the chopping block.
I think the strong retail spending expected this holiday season may provide a temporary lift, but it is unlikely to meaningfully reverse the broader trend of retail job losses in 2026. While consumer spending may hit new highs (or at least remain resilient), much of that increase is being driven by inflation and price increases rather than a substantial uptick in units sold. Meanwhile, seasonal hiring forecasts remain muted: the National Retail Federation (NRF) projects just 265,000–365,000 new holiday positions for 2025 — the weakest holiday hiring wave in years. Nor do we see broad hiring announcements across major retail chains, suggesting that retailers are viewing this holiday increment as an opportunity to maximize operating leverage rather than rebuild full-time staffing.
Yes — I do think retailers have increasingly embraced leaner staffing levels in physical stores as the “new normal.” After years of pressure on margins, rising labor costs, and a shift toward automation and omnichannel fulfillment, many retailers appear to be recalibrating staffing downward and relying more on efficiency rather than headcount. The bet seems to be that consumers, under continued inflationary pressure, will accept reduced staffing levels as long as prices remain low and convenience remains intact. Whether that bet pays off remains uncertain: customer service, in-store experience, and execution quality may suffer.
In my view, the future of retail employment is rooted in macroeconomic outlook and policy, not in any single strong holiday season. Real improvement in job growth will depend on broader economic stability — especially a reversal of tariff-related cost pressures, inflation easing, and renewed investment in brick-and-mortar execution. Until those conditions materialize, holiday sales spikes may offer transient relief to retailers at best — not a durable rebound for retail employment.
It’s important to recognize that the forces driving this year’s layoffs—tariff policy, inflation, reduced household income, and low consumer confidence—aren’t going away after the holiday season. At the same time, retailers have moved toward permanently leaner staffing models, leveraging AI, self-checkout, and other efficiency-driven tools to stay competitive with fewer employees.
Whether consumers have truly accepted this “new normal” is less certain. Many are dealing with pressures far more disruptive than retail service levels, so what might look like acceptance may be distraction or fatigue. Retailers need to distinguish between genuine consumer tolerance and consumers who are too strained or preoccupied to push back, and plan for step after next.
Exactly.
The harbinger of Black Friday results should be eye-opening. Salesforce reported sales revenue up 7%, but volume down 1%. Those numbers are screaming, “We’ve got a problem.” It seems retail CEOs continue to boast of a wonderful holiday season.
Maybe the boast is for the public, and the reality is they see the need for job cuts?. Do you need more employees if your volume is actually down? Sadly, this was all predictable, and it isn’t going to get any better as non-tariff inventory clears. Does that mean less retail volume? Less disposable income for consumers? Less volume? Is there less need for retail staff?
The bet is YES!
Exactly.
We really need a better framework for discussing sales, to get beyond reacting to PR puff pieces about “strong”, “weak” etc. What does – say – a 2.5% sales increase mean if prices were up 3% ….and population was up 1%?
And that’s just at the aggregate level; at the company level, it’s even more confusing: macy*s was lauded for “increases” that somehow had the Top stores underperforming their average…how? (by including high-flyer bloomingdales); adding to the confusion is excluding what is becoming an ever-growing percentage of discontinued operations.
The math is so easy. Why does everyone seem to ignore it. Per your equation, if sales are not at least 3.5%, they aren’t up. Let’s stop pretending and address reality.
I’m not sure how we read this article, along with all the other news about Black Friday and the consumer environment in general, and call the spending “seemingly strong”. Holiday spending may be one of the most powerful incentives the consumer has all year. It seems more accurate to say that the spending rubber band is about to be stretched to the max during holiday 2025, hopefully not snapping, but pulling back in the first quarter of 2026. Consumer debt and deliquency data are not our friend at this moment. What kind of cheerful, updeat spending motivators, and enablers, await us post holiday? At a minimum, 2026 will have a slow start. Buckle in.
Stretched to the max. I like the analogy.