How do I economy? A business needs to make a profit in order to stay in business and provide goods for customers.

I also think people do not realize the size of Target, which means a lot of people making $15 an hour.

Reality runs deeper than Target’s size, though. You have to take into consideration the continuous changes happening in the retail sector.

Employees

Employees told CNN Business supervisors have given them different reasons for the cut hours, including that there were not hours available or that their managers couldn’t fit additional hours in their budgets. Some received no explanations.

Heather said she used to work around 40 hours a week, but now brings in around 20 hours.

Caren Morales explained that Target cut her hours when her “medical coverage was about to kick in.” She worked between 35-40 hours a week, well above the 30 hours a week minimum, but went down to 15 hours a week.

Morales had to quit because she could not afford daycare.

Target worker Tony said the big pay raise”really doesn’t help much when [I’m] only doing 20 to 30 hours a week.”

Victor Hanousek quit when his hours went down to 22 hours a week.

Why Though?

So let’s look at the reasons given to the employees. They appear pretty vague, right? How about some specifics?

Modernization. The world is constantly changing. A business needs to make a profit to stay in business, but it has to change with the world as well:

Target has overhauled operations at its 1,850 US stores in recent years to create more specialized positions for staffers, who now often focus on a single department, instead of the entire store. Target also eliminated backroom shifts at some stores. Backroom teams used to unload boxes and make sure inventory was in stock, but Target moved some of those employees to the sales floor. The new model is known as “modernization.”

Target says it changed its operating procedures in an attempt to improve customer service, make stores capable of fulfilling online orders and improve productivity.

“We knew we couldn’t operate the stores anymore in the same fashion we had for the last 20, 30 years,” Target COO John Mulligan told CNN Business in an interview for this story. “We needed to change the way we operate in the store to create a better, more inviting experience for our guests.”

Have you gone to Target in the middle of the day during the week? It’s pretty empty. Have you gone to Target on a Saturday or Sunday? BUSY:

Target acknowledged that, as part of its store operations overhaul, it has shifted some payroll hours from the mornings and daytime hours to nights and weekends to match customer demand. That has impacted some workers’ schedules, Target said, although it said it has added millions of payroll hours in recent years.

A few times during the day the store can get busy, but overall it’s pretty slow. Why have people at the registers or around the store if they remain idle the majority of the time? Target has relieved some of this anxiety for shoppers with the self-checkout lane.

Lee Beecher, who works at a Target in California, complained about how his hours “fluctuate a lot” and said “[I]t’s not fair.” He gains more hours before and during the holidays

That’s the reality of working retail. Target brings in one-third of its yearly profit during the holidays.

Due to the ups and downs of shopping habits the stores need flexibility. It does not help that health insurance costs have gone up:

Retailers often want to have a larger pool of part-time workers making the minimum wage, instead of a smaller group of full-time staffers with benefits and guaranteed hours, said Lonnie Golden, professor of economics and labor relations at Penn State University-Abington.

This strategy gives companies more flexibility to adjust workers’ schedules based on store demands and helps them labor costs, Golden said.

It’s often cheaper for retailers to employ part-time workers, rather than full-time employees, because health insurance costs are going up, because full-time workers get more paid time off and because, if there is extra work on short notice full-time workers would likely become eligible for overtime premium pay for additional hours they work above 40 a week, Golden said.

Online Shopping

Back in April, online shopping became one of the largest parts of retail. I admit that I rarely go to my physical Target. I shop Target online most of the time. Amazon gets most of my money. From CNBC:

The online sector, referred to as “clicks,” has been slowly eating up market share in the past two decades. Its total rose from below 5 percent in the late 1990s to about 12 percent in 2019, according to the Commerce Department. In February, online sales narrowly beat general merchandise stores, including department stores, warehouse clubs and super-centers. Non-store retail sales last month accounted for 11.813 percent of the total, compared with 11.807 percent for general merchandise. To be sure, brick-and-mortar sales are higher when including other categories such as auto and restaurant sales.

“Sure, we had to go out to three decimal places, so the margin of different is extremely small, but looking at the chart the trend remains clear; the share of total sales for each sector are clearly going in opposite directions,” Hickey said in a note.

There are other categories of brick-and-mortar stores not included in general merchandise, such as clothing and accessories stores.

Online sales is now the fourth largest sector overall, bringing in about $59.8 billion in adjusted sales for February. Motor vehicles and parts is the largest segment, making up about 20 percent of all retail spending. Food and beverage store sales and restaurants and bar sales each make up about 12 percent.

The Bureau of Labor Statistics said about 30% of the 15 million “retail workers worked fewer than 35 hours a week last year.” Only 17% usually work fewer than 35 hours.

Most people, even part-time workers, want more hours. Some even want to work fulltime.

But until you can control the erratic world of retail nothing will change.

 
 
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