VP of Global Marketing
27 December 2020
The COVID-19 pandemic has left the retail industry, the largest private sector employer in the U.S., reeling from its impact. Tiered lockdown rules during the course of the year and a massive shift in consumer shopping behavior toward online, have resulted in millions of workers being furloughed, laid off, re-hired, or assigned new roles to adapt to changing dynamics.
Our data on millions of jobs powered by the Joveo platform every day, indicates that retail was one of the few industries to experience unprecedented demand during the onset of the pandemic, when shoppers, besides moving to online stores in droves, began panic buying at offline stores and hoarding supplies.
Store owners needed additional staff to cope with the surge in demand. Almost immediately, staff had to be repurposed from non-essential roles to essential ones, wherever possible; and laid off, where not. There was still a dearth of essential personnel.
In fact, while the U.S. Bureau of Labor Statistics reports that about 2.4 million workers were dropped during the height of the pandemic in March and April, the reality is that the retail workforce was being redeployed to serve essential functions that were in high demand.
Overall, throughout the year, online and offline retailers alike were forced to hire in large volumes across a variety of roles. This caused the average cost per click (CPC) for jobs in the space to grow by 29% year-on-year (YoY) in 2020.
The average click to apply (CTA) conversion rate, however, fell by 43%, thanks to a growing number of jobs as well as job seekers, who could now explore several opportunities before narrowing down on the ideal ones. This resulted in cost per applicant (CPA) rates increasing from an average of $1.64 in 2019 to $3.69 in 2020, a whopping 125% increase.
In other words, retail businesses witnessed their talent sourcing costs more than double this year as they scrambled to adequately serve online as well as offline shoppers.
As we break down these recruitment advertising metrics by month in 2020, it becomes clear that there was a spurt in demand for workers during March, April, and May, leading to a dramatic rise in CPC values during these months.
As a result, CPA values grew significantly during this period as well. Subsequently, they more or less stabilized for the rest of the year, albeit at a higher level than they were at before the pandemic, thanks to the onset of the holiday season.
However, CTA rates consistently declined after the summer, as job seekers had a number of opportunities to choose from (as the number of vacancies shot up), so they clicked on several jobs before filling out applications.
Analysts believe that even after the pandemic is behind us, the retail workforce could stay the same, or shrink further. A large number of retail jobs may have moved permanently to the warehouse (and other roles) as e-commerce becomes more ubiquitous.
Several brick-and-mortar retailers realize they can’t afford to retain the same headcount on their payroll. According to Adzuna data, as stores remain closed in lockdowns, in-person retail service jobs were down 37% in November.
As costs for everything – from acquiring talent to paying wages to sanitizing stock and stores – increase, store owners are learning to operate with leaner workforces.
Keep an eye out for more insights as well as our full report on the State of Recruitment Advertising in 2021, which will be published soon!