This story is part of Glossy and Modern Retail’s series breaking down the big conversations and innovations at NRF 2024: Retail’s Big Show. Click here for more stories in this series.
At the National Retail Federation’s Big Show this year at NYC’s Javits Center, much of the conversation among executives and the technologies on the show floor revolved around artificial intelligence. Panelists and exhibitors alike talked up ways in which AI can replace or simplify the work that would normally take much more manpower to complete. Processes like analyzing inventory allocation to stores and analyzing sales trends were all candidates for AI automation.
But that doesn’t mean retailers have forgotten about the human element. Multiple executives in attendance at NRF said that talent is more important than ever. According to the U.S. Chamber of Commerce, jobs that require in-person attendance, as many retail jobs do, are experiencing shortages in the available labor pool. As of August of 2023, more than 30 million workers had quit their jobs since the start of the year, the Chamber of Commerce reported. It’s becoming more important than ever for retail brands to offer qualitative incentives for employees to stay loyal so that they can keep doing the jobs that an AI model cannot.
Michelle Gass, president of the Levi Strauss Corporation, said one of the main things her company has been doing to improve retention and morale is running the Red Tab Foundation, an internal fund that assists Levi’s employees during times of extreme financial stress. For example, an employee whose daughter was injured in a fire received coverage of her living expenses while she took extensive time off to care for her daughter. In 2023, the Red Tab Foundation dispersed more than $3 million in emergency assistance to current and retired Levi’s employees, a 50% increase over the year before.
According to Gass, this is a key way to improve company culture and make employees feel valued and incentivized to stay in the long term.
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But as the labor shortage continues, there is a recent development that may be helpful for retail brands. The massive layoffs that have swept across tech over the last year may have put some very in-demand workers back on the market.
Major tech companies like Google, Microsoft, Meta, Amazon and Salesforce collectively laid off 6-13% of their workers in the last year. That means thousands of skilled employees with backgrounds in technology at major companies are looking for work. Harmit Singh, chief financial and growth officer at Levi’s, said that hiring employees with a wide range of skills and backgrounds will be critical for retail’s success going forward.
“Talent is the piece that really differentiates companies,” Singh said. “Diversity is critical — diversity of thought, diversity of races and genders, and bringing in different viewpoints. Breadth of experience is important, too. One of my learnings is to hire people who are not only functionally deep but who also have a wide range of experiences. Seeing people evolve and grow is one of my proudest achievements as a leader, and it’s what makes a business strong over time.”
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AI may help fill the gaps left by a labor shortage in retail, but, Dayna Quanbeck, COO and CFO of footwear brand Rothy’s said, AI isn’t a suitable replacement for the high-level thinking and strategizing needed to make a brand run.
“When I started my career, you had to read stuff by hand. Now you press a button and you can see the full P&L of your business,” Quanbeck said. “It’s nice to do things by hand, but that takes time away from doing other things. Technology and AI are great for handling 80% of our business, and then we hire the best talent to manage that 20% at the top. That needs a human mind, and not a black box, to do the things that machines can’t do. Maybe machines will be able to do it someday, but I’m not convinced yet. Great talent is still critical.”
