Retailers are hiring up to 40% fewer seasonal workers compared to last year, while applications for seasonal positions jumped 27% compared to last December. The supply-demand imbalance reveals just how dramatically the retail hiring market has shifted.

The National Retail Federation forecasts retailers will hire between 265,000 and 365,000 seasonal workers in 2025, down from 442,000 last year—a reduction of up to 40% depending on where final numbers land. But job seekers don't seem to have gotten the memo, flooding seasonal job postings with applications at rates 27% higher than last year.

For retailers, this creates an embarrassment of riches—far more qualified candidates than positions available. For job seekers, it's a brutal market where even seasonal retail roles are increasingly competitive.

Why Retailers Are Hiring Less

Consumer spending shifted online: While shoppers are expected to spend over $1 trillion during the holidays, more of that spending happens through e-commerce than in physical stores. Online shopping requires warehouse workers and delivery drivers, not retail floor staff.

Technology automation: Self-checkout systems, mobile payment apps, and automated inventory management reduce the need for seasonal cashiers and stock clerks. Retailers invested heavily in these technologies during and after COVID, and they're now reducing labor needs during peak season.

Leaner operations: Many retailers operated through the 2024 holiday season with smaller seasonal workforces than historical norms and discovered sales held steady. That convinced them they could do the same in 2025, banking the labor cost savings.

Uncertain economic outlook: Retailers are hedging against potential consumer spending pullback by maintaining conservative hiring plans. If holiday sales underperform, they don't want to be carrying excess seasonal labor costs.

Why Applications Are Surging

June 2025 marked the first time since 2021 that the number of unemployed in the US exceeded the number of open jobs. More people are looking for work, including seasonal work, because they need income.

Entry-level market struggles: Recent college graduate unemployment jumped to 4.59% from 3.25% in 2019—a 41% increase. Young workers who would normally secure full-time roles are applying for seasonal retail to generate income while continuing their job search.

Gig economy participants seeking stability: The seasonal retail surge in applications includes gig workers looking to supplement unpredictable income with reliable part-time hours during the holidays.

Geographic and industry concentration: Job postings fell 5% month-over-month in November across industries, pushing workers in affected sectors toward retail as one of the few industries still hiring in December.

The Math Is Brutal for Candidates

Let's make this concrete with hypothetical but realistic numbers:

2024 Holiday Season:

• Retailers hired: ~440,000 seasonal workers
• Applications received: ~2 million (estimated based on typical retail application volumes)
• Acceptance rate: ~22% (1 in 5 applicants got hired)

2025 Holiday Season:

• Retailers hiring: ~315,000 seasonal workers (midpoint of forecast range)
• Applications received: ~2.54 million (27% increase)
• Acceptance rate: ~12% (roughly 1 in 8 applicants get hired)

That's a massive shift in competitiveness. Seasonal retail jobs that were accessible to most applicants last year are now selective.

Winners and Losers in Retail Seasonal Hiring

Winners - Retailers: Abundant candidate supply with reduced competition means retailers can be far more selective about who they hire. They can raise hiring standards, demand more experience, and still fill positions easily.

Winners - Top-tier candidates: Workers with strong retail experience, excellent availability, and reliable transportation are getting multiple offers and can negotiate better schedules or slightly higher wages.

Losers - Entry-level job seekers: First-time workers, students looking for holiday income, and people without recent retail experience are struggling to land even seasonal positions.

Losers - Workers needing flexibility: Retailers can demand open availability because they have enough applicants willing to accept any schedule offered. Candidates needing specific hours or days off are deprioritized.

But Not All Sectors Are Cutting Back

While retail seasonal hiring is down dramatically, other industries maintain or increase December hiring:

Financial institutions: Banks, credit unions, and financial services companies hire for customer service, operations, and risk management roles as transaction volumes surge during holidays.

Healthcare: Healthcare sectors maintain steady hiring regardless of season. Patient care doesn't pause for holidays.

Construction: In regions with mild winter climates, construction hiring increases in December as companies race to complete projects before year-end or capitalize on favorable weather.

Government: Government hiring typically follows budget cycles rather than seasonal patterns, with many agencies filling approved positions in Q4 before budgets reset.

Tech companies: Product development cycles and funding rounds don't pause for holidays. Many tech companies continue recruiting through December, particularly for engineering and product roles.

What This Means for Recruiting Strategies

For retailers: The abundant candidate supply creates opportunity to upgrade workforce quality. Instead of settling for "anyone willing to work holidays," retailers can selectively hire candidates with strong experience, excellent soft skills, and cultural fit. This is the time to raise standards, not lower them.

For candidates: Seasonal retail isn't the easy backup option it was historically. Candidates need to differentiate themselves—highlighting relevant experience, demonstrating strong availability, and moving quickly when opportunities arise.

For recruiters in other industries: The 40% reduction in retail seasonal hiring and 27% increase in applications means there's an unusually large pool of workers seeking any available employment. Industries hiring right now have access to candidates who would normally be absorbed by retail seasonal positions.

The Broader Market Context

This retail hiring paradox reflects wider labor market dynamics. Applications are up across many sectors as job seekers respond to the reality that unemployed workers now exceed open positions.

Job postings fell 5% month-over-month in November and are likely to soften further through December, creating the seasonal dip that occurs every year. But unlike previous years, the candidate supply hasn't decreased proportionally, creating the competitive imbalance.

The January rebound in job postings will likely help rebalance supply and demand, but for December, candidates face one of the most competitive hiring markets in recent years—even for seasonal retail work.

Strategic Implications for Companies

Use December to upgrade talent: Whether hiring for seasonal retail, customer service, or other roles, the candidate supply right now favors employers significantly. This is the time to be selective and hire top performers.

Speed matters more than ever: 27% more applications means everyone's dealing with higher volumes. Companies that move quickly on strong candidates will win. Those with slow processes will lose candidates to faster competitors, even in an employer-favorable market.

Onboard for January productivity: Companies hiring in December can onboard workers during the slow holiday period and have them fully productive when business accelerates in January. That's a strategic advantage over companies waiting until January to start hiring.

What Candidates Should Do

Look beyond retail: If retail seasonal roles are 40% scarcer and 27% more competitive, candidates should expand their search to other industries hiring in December—financial services, healthcare, construction, government, and tech.

Move fast: When you get interview requests, respond immediately. In a market with 27% more applications, delays mean losing opportunities to other candidates.

Emphasize availability and reliability: Retailers prioritizing these factors because they can afford to be selective. Highlighting flexible scheduling and strong attendance history differentiates you from other applicants.

Apply to corporate positions: Many corporations continue hiring through December for non-seasonal roles. These positions have less competition than seasonal retail right now because most job seekers assume companies pause hiring during holidays.

The Takeaway

Retailers hiring 40% fewer seasonal workers while receiving 27% more applications isn't just a retail story—it's a microcosm of the broader labor market shift happening in late 2025.

For employers across industries, this is an unusually favorable hiring market with strong candidate supply and reduced competition. For job seekers, even traditionally accessible roles like seasonal retail have become significantly more competitive.

The January hiring rebound will likely rebalance these dynamics, but for December, the paradox is clear: more people want seasonal work than there are seasonal jobs available, even as overall hiring in other sectors continues for those who look beyond retail.

The companies capitalizing on this December opportunity are the ones treating it strategically rather than pausing all hiring until January. The candidates finding roles are the ones looking beyond the obvious seasonal retail positions to industries still hiring steadily through year-end.