Unwrapping Holiday Hiring

by Luke Coury

November 30, 2022

The holiday season provides retailers and package delivery companies with a much needed end-of-year boost in sales. To respond to this increase in demand, some businesses hire extra workers, often on a temporary basis. Businesses with this kind of strong holiday employment pattern comprise “holiday hiring” industries. These industries saw strong growth during the 2021 holiday season.

The 2021 Holiday Buildup

An industry’s “holiday buildup”, or the number of employees added during the holiday season, is a convenient way to measure holiday hiring activity. Oregon’s buildup in traditional holiday hiring industries was 11,928 in 2021, representing a 9.4% increase compared with the pre-buildup employment level in September. This level was similar to the long-term average buildup of 11,307 (9.5%) over the last two decades.

Holiday buildups have varied considerably since 2001, ranging from a high of about 15,000 (13%) in 2005 to a financial crisis-induced low of less than half that in 2008. Holiday hiring increased sharply during the first year of the pandemic in 2020. The 2021 buildup was smaller than the previous year, but still strong by historic standards.

Couriers and Messengers Deliver Largest Holiday Buildup

Holiday buildup was especially concentrated in a few holiday hiring industries in 2021. The private couriers and messengers industry had the largest buildup, adding 5,032 jobs. This figure is more than twice the industry’s average buildup of 1,995 between 2001 and 2020. Along with postal services, the other major package delivering industry, couriers and messengers accounted for about 41% of the total holiday buildup. Other industries with a large buildup included general merchandise stores (2,278) and clothing and accessory stores (1,984).

The U.S. Postal Service used to be a strong contributor to Oregon’s holiday buildup, adding more than 500 jobs each holiday season. That number fell drastically in 2007, but recovered towards the end of the 2010s, adding more than 400 jobs during the 2018 holiday season. Since 2018, however, the Postal Service’s holiday hiring has again decreased significantly, adding just 153 jobs in 2021.

Bricks to Clicks

The holiday hiring retail industries included so far in this article are based on the March 2009 Bureau of Labor Statistics article Holiday Season Hiring in Retail Trade. Jobs at postal services (both private and federal) and couriers and messengers were added to give a more complete picture of traditional industries with strong holiday hiring patterns. These industries do not, however, fully capture the expanding role of e-commerce in recent holiday buildups.

Hiring patterns in 2021 continued the shift in retail caused by advancements in technology. The prevalence of online shopping has increased the need for jobs in transportation industries and caused traditional retailers to increase temporary staffing in their distribution and fulfillment centers. In-store workers have also begun fulfilling online purchases using in-store merchandise, blurring the line between serving online and in-store customers.  

The shift to online shopping will likely decrease holiday hiring for traditional brick and mortar retailers while bolstering demand for workers in industries more closely related to e-commerce. Indeed, warehousing and storage has boomed in recent years. This industry includes businesses which operate warehousing and storage facilities for general merchandise, refrigerated goods, and other warehouse products and is therefore closely tied to e-commerce.

When all e-commerce industries are included into the mix, recent holiday hiring increased to levels not seen since before the Great Recession. The holiday buildup in 2020 was a record 15,100. Buildups in 2019 and 2021 were both above 13,000. The last time holiday buildups were that high was the run of years from 2004 to 2006, when buildups reached an average level of 14,000.

While 2021’s holiday hiring levels returned to mid-2000s levels, the make-up of holiday hiring industries was considerably different. Between 2004 and 2006, about 70% of holiday hiring took place in brick and mortar industries. In 2021, only about 43% of holiday hiring did. That means around 27% of hiring shifted to e-commerce in the last 15 years.

2022’s Wish List

Holiday buildups typically lead to corresponding post-holiday employment declines as businesses adjust back to the usual pace of sales. It is possible, however, that the labor shortages experienced by many businesses during 2022 could reduce post-holiday staffing reductions. Since workers have been hard to find, employers could be more reluctant to let go of employees once they have them.

It is difficult to know the long-term impacts of the COVID-19 pandemic on seasonal hiring patterns. The transition to online shopping, accelerated by the pandemic, will probably continue. This should mean consistent holiday hiring for e-commerce industries, like warehousing and storage, over the long term.

The future for brick and mortar stores is more uncertain. Local retailers may decrease their holiday hiring if customers shop in-person less frequently. However, traditional brick and mortar retailers may pivot to offer more online shopping options and may still require more workers during the holidays, just in different occupations.    

We won’t know how this season’s holiday hiring compares with prior years until sometime in the New Year, but employment forecasts can suggest what the future might bring. The December 2022 employment forecast from the Oregon Office of Economic Analysis (OEA) projects Oregon’s retail trade employment to grow by less than 50 jobs in the fourth quarter of 2022. OEA expects transportation, warehousing, and utilities to decrease by around 70 jobs in the same period. It is important to note that these forecasts are for entire sectors, not just holiday hiring industries. Still, they suggest that the holiday buildup may be below average this year.


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