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Retail Boosts Jobs in December

Sector accounts for bulk of monthly gain.

WASHINGTON — Retail employment accounted for 75 percent of the overall employment gain in December, as the economy posted a weaker-than-expected increase and the unemployment rate fell, the U.S. Labor Department’s monthly employment report showed Friday.

Clothing and accessories stores added a seasonally adjusted 11,500 jobs to employ 1.4 million in December.

General merchandise stores, a category including discounters and department stores, added 7,600 jobs to employ 3.2 million, while department stores increased employment by 3,100 to employ 1.5 million.

In the overall economy, employers added 74,000 jobs in December, with all retailers accounting for 55,000 of the employment gain. The unemployment rate fell to 6.7 percent from 7 percent in November, but economists cautioned it was more due to people not looking for work, as opposed to employment gains.

Paul Edelstein, director of financial economics at IHS Global Insight, said that the gain of 74,000 jobs in the overall economy represented a “massive slowdown” from the 214,000 jobs created in November and 200,000 jobs added in October and was much lower than the 190,000-plus jobs forecast for December.

Edelstein attributed the weak job growth to weather, noting that bad weather kept 273,000 people from their jobs in December. Despite that, retailers continued hiring last month.

“Retail employment was strong, where just about everything else was weak,” said Scott Hoyt, director of consumer economics of Moody’s Analytics. “It did seem like retailers were willing to hire and perhaps do so in spite of the weather, whereas the weather was more of a factor for some other industries.”

On a year-over-year basis, general merchandise stores added 99,900 jobs in December, while department stores added 33,400 and specialty stores trimmed 8,400.

“I think that apparel and accessories stores hired aggressively in 2012 and now they are utilizing the workers they have, whereas both department stores and general merchandise stores were letting people go in 2012 and now they are bringing staffing back up to some extent,” Hoyt said.

Jack Kleinhenz, chief economist at the National Retail Federation, said, “While the employment gains were much lower than anticipated, gains were made and the economy seems primed for growth. The shortened holiday calendar and severe weather in many parts of the country certainly impacted these figures, but I suspect we will see upward revisions in the coming months.”

In the apparel and textile manufacturing sector, apparel employment fell by 400 to employ 139,900. Mills making apparel fabrics and yarns added 1,000 jobs to employ 115,500, while mills making home furnishings products trimmed 1,000 jobs to employ 112,400.