Yet Walmart, of course, isn’t the biggest threat facing retail workers anymore. That would be the inexorable growth of e‑commerce, which is poised to capture more than 8 percent of total retail sales by the end of 2013, according to Forrester Research. Looming over the online retail market is Amazon, which accounts for a quarter of all online purchases, and has by now fully grown into its name. Amazon amasses more than $600,000 in sales per full-time employee—three times the retail average.
The Web has changed how shoppers find what they’re looking for. Browsing, narrowing down options, and purchasing used to involve as many as three trips to the mall. But with smartphone penetration screaming past 50 percent in the U.S., all three can be done at home, on the couch, on the street—anywhere, really. Shoppers use the Web to research more than half of all the goods they eventually buy in person, said Ron Josey, an Internet analyst with JMP Securities. “By the time they get to the store, they already know what they want.”
Twenty years ago, the shoppers went to the stores. Today, the stores go to the shoppers. From the floor salespeople replaced by informative Web sites to the cashiers nudged aside by automatic checkout machines, the daily tasks once performed by store employees are either being taken over by machines or outsourced to customers.
Should we mourn the end of retail? The exodus from American farms marked the end of self-sufficiency and an uprooting of families from their heritage. As manufacturing sputtered, so too did a jobs engine that could carry people with few initial skills into the middle class. It’s harder to get nostalgic about mall jobs and supermarket cashiering.
Standard economic theory suggests that, in a smoothly functioning economy, low-skill jobs really do grow on trees, and are largely fungible—it’s the steady loss of middle-class jobs we should worry about. And indeed, occupations with median hourly wages of less than $14 accounted for nearly 60 percent of all job growth between 2008 and early 2010. Retail jobs aren’t going suddenly, cataclysmically extinct; they’re likely to decline slowly. A cursory glance at the fastest-growing sectors suggests that as retail declines, its workers will simply stream into menial health-care and food-service jobs.
Yet there is a worse scenario, in which the squeeze in retail work intensifies competition for other low-skill jobs, pushing down wages at the bottom and pushing some people out of the labor force entirely. This possibility should not be dismissed too readily: The contraction of the U.S. workweek beginning in the 1960s was “primarily caused” by the contraction in retail work, according to the Bureau of Labor Statistics. The extra hours were not absorbed by other sectors.
The depopulation of retail has come with other downsides. “After the crisis, retailers dropped staff and rushed to technology to save them,” said Piers Fawkes, a retail analyst with PSFK, a consultancy focused on innovation. “Web sites, kiosks, QR codes, and all this in-store technology replaced the human touch.” Among the results: longer checkout lines, less help, more disarray. Walmart, which has cut its total workforce by 20,000 since 2008, despite opening 455 new stores, has finished last among department and discount stores in the American Customer Satisfaction Index for six years in a row.