As Black Friday approaches and America enters the holiday shopping season, spare a thought for the woebegone souls toiling for pennies at whatever’s left of the country’s brick and mortar retailers.
Hourly retail jobs are thankless even as a thankless work goes. Once upon my glorious twenties — may they live in eternity — I briefly dated a J. Crew store manager. (Don’t ask. Even I can’t make that story exciting.) Miserable as she was, I can only imagine how bad it must’ve been for her subordinates.
With the caveat that working in ultra high-end fashion is perhaps a bit more enjoyable and certainly more lucrative than folding jeans at The Gap (shout out to Brooks at the Nashville Louis Vuitton, Eunice at the Tysons Galleria Golden Goose and Ariana at the Neiman Marcus Chanel in Atlanta), I assume the same holds true today. That is: Working retail’s probably a soul-destroying experience that doesn’t pay a living wage.
That suspicion’s confirmed by Redfin’s Lily Katz, whose wonderful analysis I’m thankful for this Thanksgiving. She ran the numbers.
The figure above shows you the median annual income for a retail worker in the US along with the median annual income needed to afford the typical apartment. And the disparity between the two. It’s not a pretty picture.
“The typical retail worker earns 51.6% less than they would need to afford” rent, Katz remarked, in a November 26 piece.
Redfin uses the standard metric to determine what counts as affordable: The 30% threshold. Recall from the November 2023 Monthly Letter that 30% isn’t just some marginally useful rule of thumb. It’s an actual marker for predicting the onset of a homelessness spiral.
The figure above’s based on research conducted by academics including Penn’s Dennis Culhane, one of America’s foremost authorities on homelessness.
Once the share of income spent on rent reaches 32%, community leaders can expect a “rapid” (as the study from which that chart’s derived put it) increase in homelessness rates.
Writing in the same Wednesday piece, Katz did some more math. “If the typical retail worker wanted to afford the typical apartment on their own, they would need to work 83 hours per week,” she said. “Which is obviously unrealistic for most people.”
Worked retail at a long defunct department store while at college somewhere along the NYS thruway back in the day (before stores opened on Thursday). In the time before the internet, the isles looked like the Daytona 500 at 7 AM and the toy department became Lord of the Flies by 7:05 AM. A lot to take in for $4.25 an hour before they took union dues.
Spent four years working at a retail sporting goods store while going to college in the Mountain West. Made wonderful friends. Learned to be a proficient skier (backcountry and alpine,) backpacker, upland and waterfowl hunter, fly fisherman, all thanks to the friends I met there. Loved every minute of it, and got an MBA in the process, thanks in large part to the store manager, who made it a point to make sure that I understood the importance of LEAVING retail, and getting my ass to grad school. My best friend at the store stayed in the industry and ended up moving away, chasing a store management opportunity. Twenty years later–he was still working in retail management–I heard from his ex-wife that he went to jail for embezzlement. It wasn’t drugs. It wasn’t gambling. It was a just trying to feed his kids. A soul-crushing experience sounds about right.
I run two (soon to be three) retail wine shops. I grapple constantly with trying to figure out how to pay my full time folks better, but damn it’s hard (especially with alcohol in a recession, leaving the boss with making next to nothing for a few years now, living on the wife’s income). I pay their healthcare 100%, but that doesn’t pay the rent nor buy food (and next year they’ll pick up a nominal co-pay on the monthly, a turn of events that I wish I could avoid). Maybe this third store will right the ship and everyone gets a raise (we lose money on every sale, but we make up for it on volume!), but truth be told, especially in this area, it’s still not enough.
If I had lived in NY, I might have applied to be one of your store managers.
Rent being the subject of this piece, during the years I managed a wine store I lived in a 360 square foot in-Law a 7 minute walk from the store.
My daughter, a borderline Millenial/GenZ and current attendant of AAA, is a financial analyst for a publicly-held, global wine company (via one of their purchases of a large California winery); she regularly tells me that wine sales are down both nationally and internationally.
If you read that sentence carefully, it says a lot about the current state of the wine industry.
AA, not AAA 🙂
I conducted my own “Nickel and Dimed” experiment this past year — there are many, many reasons but one was that I did not want to have a sedentary job while recovering from a 2024 traffic accident. You are right to point out rent/earnings ratio as a serious measure of financial stability. However, at the particular location of current retail work, there’s a spectrum of people with transportation assets (decent cars to no driver’s license status), savings (from a grandmother who can treat her grandkids to shows at TicketMaster pricing to SNAP’ed co-workers who need food donations from the rest of us). Medical benefits stink for the full-time hires, so one needs to rely on having family members with better insurance.
I can afford to be retired, but do not want to be retired. I disagree that this work (retail) is more soul-destroying than the STEM work that is available — with my background, that would be failing defense programs either in this state or closer to Boston MA such as Patriot or subcontracted software repair for the F-35 program. What makes work bad is based on bad behavior from co-workers and managers — I’ll be leaving here with the “cover story” of requiring more surgery, but there is a problem with employee theft (stealing tips) and employee irresponsibility (not showing up) which destroys trust, similar to behavior I saw in the white collar world for decades. White collar folks need to remember that they too are retail, if there is a buyer somewhere for their product.
Anyways, I’m thankful for having options, and do my best to bring my proverbial “A” game to whatever project for which I sign up. I’m also grateful I can look for something else. Happy Thanksgiving to all who celebrate it.