Is the #Internet impacting the #retail service sector? Probably

I found the following information on retail trade employment interesting.  According to today’s jobs situation report, retail trade employment fell by 24,000 in March 2013.  Employment, according to the Labor Department, has been falling on average by 32,000 a month for the last six months.

The retail sector accounts for approximately 10.5% of the total number of employed in the United States, employing approximately 15.017 million people. The average decreases in retail sector employment can have a significant impact on the economy unless these individuals have some where else to go and work.

One factor that may be contributing to the fall off is the Internet.  Retailers are having to adjust their sales processes and revamp the layouts, sizes, and locations of their stores to compete for customers they may be losing to e-commerce.  Re-engineering to combat these losses may be taking a toll on employment in brick and mortar stores.

Does this call for government action?  Hell, no.  We’ve seen enough of that in the financial and automobile industries and the jury is out on whether bailouts merely shifted employment away from industries that could have hired workers that would otherwise been permanently let go by automakers.

The fall off in retail employment is merely the result that this industry, one known for its tight margins, probably prefers: a lower cost way of distributing product resulting in lower labor costs and higher margins.  It also keeps on the front burner the need for lower skilled workers to stay ahead of changes in technology so that they can avoid this type of displacement.

About Alton Drew

Alton Drew brings a straight forward and insightful brand of political market intelligence. Alton Drew graduated from the Florida State University with a Bachelor of Science in economics and political science (1984); a Master of Public Administration (1993); and a Juris Doctor (1999). You can also follow Alton Drew on Twitter @altondrew.
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