Holiday Hiring Slump Raises Alarms as Retailers Brace for Unpredictable Season

Hiring Slips Even as Spending Gears Up

According to projections from the National Retail Federation (NRF), U.S. retailers plan to add between 265,000 and 365,000 seasonal workers this holiday season. That is the lowest level in at least 15 years and a sharp drop from the 442,000 hires made last year.

At the same time, the NRF expects holiday spending from November 1 to December 31 to reach between $1.1 trillion and $1.2 trillion, the first time that total would exceed $1 trillion. This would represent 3.7% to 4.2% growth compared to the previous year.

The gap between record spending and limited hiring highlights a cautious approach among retailers. Many are confident in consumer demand but unwilling to expand headcount in an uncertain economy.

What’s Driving the Pullback in Hiring

A number of forces are behind this year’s decline in seasonal hiring:

Inflation and rising costs: Higher wages, tariffs, and supply chain costs have made retailers more conservative with labor budgets.

Trade and tariff uncertainty: Frequent shifts in trade policy have complicated inventory and staffing plans, discouraging over-hiring.

Automation and efficiency: Many retailers are turning to technology to fill operational gaps. AI, robotics, and analytics are helping them optimize shelf management, checkout flow, and online fulfillment without additional staff.

Cautious consumer sentiment: Even though overall spending remains high, many households are trimming discretionary budgets. Retailers are planning for a leaner holiday season rather than risk being overextended.

Fewer public hiring commitments: Several large retailers have quietly chosen not to announce specific seasonal hiring targets, preferring to use flexible, on-demand labor pools instead.

NRF Chief Economist Mark Mathews summed up the sentiment in a CNBC interview, saying uncertainty remains the defining challenge for businesses. When conditions are unpredictable, companies tend to pause major hiring decisions until visibility improves.

Implications for Retail Suppliers and Store Operations

The slowdown in seasonal hiring will ripple across store operations and supplier relationships.

Operational risk: With fewer temporary associates, retailers may face slower restocking, longer checkout times, and more strain on in-store service. Suppliers could feel pressure to ensure accurate inventory and smooth execution to prevent disruptions.

Supplier opportunity: Brands that can help streamline operations through packaging, merchandising, or in-store support may become more valuable partners. Providing tools or field support that reduce a retailer’s labor dependency could strengthen relationships going into 2026.

For store teams: Retailers are likely to rely more on cross-trained employees and short-term gig workers instead of large waves of seasonal hires. Some companies are using existing pools of flexible workers who can be activated quickly based on sales trends and local demand.

Strategy Recommendations for the Holiday Season

1. Plan for lean staffing scenarios. Map out what peak operations look like with fewer workers. Identify pressure points in fulfillment, restocking, and service, and plan backup coverage.
2. Invest in training and productivity. With smaller teams, every associate matters more. Provide efficient onboarding and make sure seasonal hires are focused on the most critical customer-facing tasks.
3. Use technology to augment labor. Mobile apps, digital shelf tools, and automated replenishment systems can help teams move faster and reduce friction during high-traffic periods.
4. Collaborate with suppliers early. Share forecasts and staffing limitations with supplier partners. Encourage them to plan display setups and promotional support that align with reduced in-store labor capacity.
5. Stay nimble. Track store traffic and conversion closely and be ready to reassign shifts or add temporary help late in the season if spending exceeds expectations.
6. Protect the customer experience. When labor is tight, maintaining a positive in-store environment is critical. Use signage, digital assistance, and efficient layouts to offset longer wait times and preserve brand reputation.

Looking Ahead

The 2025 holiday season is shaping up to be one of contrasts. Spending will likely break records, but hiring will hit its lowest level since the Great Recession. Retailers are balancing optimism with caution as they navigate inflation, tariffs, automation, and shifting consumer behavior.

For suppliers and retail partners, adaptability will be the real measure of success. Those who can help retailers operate efficiently with leaner teams will emerge stronger. A smaller workforce does not have to mean a smaller holiday experience—it simply demands smarter coordination, sharper execution, and stronger collaboration across the retail ecosystem.

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