The retail apocalypse is creating a 'rolling crisis' that is rippling through the US economy
REUTERS/Max Rossi
The effects of these job losses will hit local economies hard, according to Mark Cohen, the director of retail studies at Columbia Business School.
"This is creating a slow-rolling crisis," Cohen told Business Insider. "The people that work in retail stores will lose their jobs, then spend less money in retail stores because they are no longer employed. That creates a a cascade of economic challenges."
Since October, 89,000 workers in general merchandise stores have lost their jobs, which is more than the number of people employed in the entire US coal industry, reports The New York Times.
During his campaign for the White House, President Trump used coal miners as an example of workers who never recovered from the recession, as the Times pointed out.
Like coal miners, retail workers don't typically have a set of skills that's easily transferable to another industry, according to Cohen.
The retail industry, which employs one out of every 10 American workers, typically pays low wages but provides employment to people in every age bracket, including those who are low-skilled and need flexible scheduling options.
So when these workers lose their jobs, they can have a hard time finding other employment.
"The coal miners are out of luck," Cohen sad. "Retail workers are in the same boat."
Mike Nudelman
The growing popularity of ecommerce is one reason why retailers are closing so many stores.
But the ecommerce industry won't come to the rescue of out-of-work retail employees.
Most warehouses are regional and typically located far from residential areas, which means they aren't within a reasonable commutable distance to displaced workers. By contrast, retail stores are typically located close to residential communities.
Ecommerce warehouses also employ people on a much more limited scale than retail stores, since they are becoming increasingly automated, Cohen said.
Unfortunately for retail workers, this crisis doesn't appear to be dissipating any time soon.
"Brick-and-mortar closings will continue to expand throughout the year," Cohen said. "There is no reason why they would abate."
- 2 states where home prices are falling because there are too many houses and not enough buyers
- US buys 81 Soviet-era combat aircraft from Russia's ally costing on average less than $20,000 each, report says
- A couple accidentally shipped their cat in an Amazon return package. It arrived safely 6 days later, hundreds of miles away.
- 9 health benefits of drinking sugarcane juice in summer
- 10 benefits of incorporating almond oil into your daily diet
- From heart health to detoxification: 10 reasons to eat beetroot
- Why did a NASA spacecraft suddenly start talking gibberish after more than 45 years of operation? What fixed it?
- ICICI Bank shares climb nearly 5% after Q4 earnings; mcap soars by ₹36,555.4 crore
- Nothing Phone (2a) blue edition launched
- JNK India IPO allotment date
- JioCinema New Plans
- Realme Narzo 70 Launched
- Apple Let Loose event
- Elon Musk Apology
- RIL cash flows
- Charlie Munger
- Feedbank IPO allotment
- Tata IPO allotment
- Most generous retirement plans
- Broadcom lays off
- Cibil Score vs Cibil Report
- Birla and Bajaj in top Richest
- Nestle Sept 2023 report
- India Equity Market