- Roughly 23 percent of retailers weren't able to hire all the temporary workers they wanted for the 2017 holiday season, according to a new report.
- About two-thirds of retailers are hoping to hire at least as many seasonal workers this year.
- U.S. unemployment is at a record low of 3.9 percent, and companies are under pressure to raise wages.
Many retailers have already announced plans to hire more seasonal workers this year than in 2017, but not all of those positions will likely be filled.
The labor market is tighter than ever. U.S. unemployment is at a record low of 3.9 percent, and companies are under pressure to raise wages, making it more difficult and expensive to keep talent, according to a new report.
Roughly 23 percent of retailers weren't able to hire all the temporary workers they wanted for the 2017 holiday season, global consulting group Korn Ferry found. That's expected to get even worse this year.
Korn Ferry, one of the world's largest executive recruiters, surveyed nearly 20 major U.S. retailers representing about 1 million employees and $1.2 billion in sales last month.
"I guarantee you this issue has gotten bigger and bigger," said Korn Ferry senior partner Craig Rowley. "There are more jobs out there than there are people looking for them. ... It's a hustle to find the talent."
Korn Ferry found that about two-thirds of retailers are hoping to hire at least as many seasonal workers this year as they did last year. But about 63 percent of respondents are also planning to give permanent workers more hours this year, when they aren't able to find people to fill shorter-term roles.
"Retailers are asking their existing employees if they can work more because they're already trained," Rowley said. "This year more than ever we're seeing employers getting workers to work more hours."
As a result, people looking for work are able to be "pickier" when choosing a job, according to A.J. Brustein, co-founder of on-demand staffing platform Wonolo. The site includes job postings, anonymous worker ratings and salary information.
It's essentially serving as an intermediary between employer and employee.
"There are more jobs that will go unfilled in the fourth quarter than the rest of the year," Brustein said. "That will happen this year for sure. I think that it will be even tougher this year for retailers."
Target said it plans to hire 120,000 workers this holiday season, up 20 percent from a year ago. Macy's is planning to hire 80,000 people, in line with its initial hiring plans in 2017. And Kohl's recently said it plans to bring on about 90,000 people to work through the New Year, compared with 69,000 people in 2016, the last time the retailer provided a number for its plans.
"It is absolutely a competitive marketplace," Stephanie Lundquist, Target's chief human resources officer, told CNBC. She said the company is gearing up to have its "biggest holiday yet." To fill jobs, Target has done things like raise the starting wage and offer more flexible hours and special discounts for employees.
Despite the challenges, retailers are still upbeat about the holiday season. Greater consumer confidence and a stronger economy are expected to push more shoppers to open their wallets wider through the remainder of the year.
A third of retailers are expecting their sales to increase as much as 10 percent this holiday season year over year, Korn Ferry's survey said.
"Last year it was about sales being tougher," Rowley told CNBC. "But hiring is tougher this year."