Retailers Say No, No, No To Holiday Season Hires For Christmas Rush

As the 2025 holiday season approaches, the traditional surge in retail hiring is set to reach its lowest level since the depths of the global financial crisis in 2008.

A recent analysis by Challenger, Gray & Christmas has projected that seasonal hiring in the retail sector will slump amid concerns from soft consumer spending to the ongoing tariff impact, which has now spread to furniture and kitchens.

Retailers added 543,100 jobs in the final quarter of 2024, a near 4% drop compared with the same period in 2023, and the firm forecasts that fewer than 500,000 seasonal positions may be added in the last quarter of 2025.

That would mark the weakest holiday hiring performance in 16 years.

Economic uncertainty and persistent inflation are creating a more cautious consumer environment, making companies wary of overcommitting to large hires. Retailers are also watching spending patterns closely and holding back on staffing plans until they have a clearer picture of demand.

Many are therefore delaying hiring decisions until closer to the holidays or skipping public hiring announcements altogether, preferring to hedge their bets rather than risk excess payroll costs if shoppers tighten their belts.

And they will be taking note of newly released reports on consumer sentiment, which paint a worrying picture.

Shoppers Feel Holiday Season Caution

When asked about the impact of tariffs, four-times more Americans said they will spend less than more this year (32% versus 8%), according to the latest consumer survey from YouGov. Almost a third (32%) of those surveyed said tariffs will lead them to spend less this year, while just 8% expect to spend more. Another 32% said they currently have no plans to change the amount they spend.

A third of consumers also noted that they are “much more likely” or “somewhat more likely” to buy more American-made products this year given new tariffs.

Meantime, retailers are also focusing on maximizing the productivity of permanent staff, training existing employees and using flexible labor models to fill gaps when necessary. This shift allows companies to avoid the expense and complexity of hiring large temporary teams, while still meeting peak demand.

Over the past several years, many companies have also invested heavily in technology, artificial intelligence and self-service cashdesks to reduce dependence on manual labor. Automation in warehouses and the rise of self-checkout systems in stores mean fewer seasonal workers are needed to handle routine tasks.

Another factor is that companies like Target have made it a priority to offer more hours to existing employees and tap into their own on-demand worker networks rather than mounting large seasonal recruitment campaigns. This strategy lowers onboarding and training costs and helps build employee loyalty, while giving retailers the ability to scale staffing up or down as required.

Some retailers have announced holiday hires. Bath & Body Works announced plans to hire 32,000 workers this holiday season, including 2,000 workers in distribution centers. Spirit Halloween plans to add 50,000 workers, while distribution and logistics company Geodis announced it would add 4,600 workers.

The U.S. retail sector currently employs about 15.5 million workers, the highest level since 2018, but employment typically trails off in September when students return to education and temporary positions end. Seasonal hiring usually offsets that decline as the holidays approach.

Holiday Season Regrets?

This year’s cautious approach carries risks for companies. If consumer demand exceeds expectations – and U.S. consumers have consistently defied economic gloom – they may find themselves scrambling to add staff late in the season, which can drive up costs and strain operations.

Challenger noted in its report that a late hiring surge remains possible if holiday spending outpaces expectations, but the muted pace of announcements so far suggests that most retailers are planning for a conservative holiday season.

“Seasonal employers are facing a confluence of factors this year: tariffs loom, inflationary pressures linger, and many companies continue to rely on automation and permanent staff instead of large waves of seasonal hires,” Challenger, Gray & Christmas Senior Vice President Andy Challenger said.

“While we could see a late hiring push if holiday sales surprise to the upside, the cautious pace of announcements so far suggests that companies are not betting on a big seasonal surge. This year may be more about doing more with less,” he added of prospects for the holiday season.