OLMIS

by Jill Cuyler
Published Oct-22-2009

Historical Growth, Recent Setbacks More People, More Retail Lower Paying Jobs Women and Men Equal in Numbers but Not Pay Optimism for the Future

Whether it is food, apparel, cars, or music, Oregon's diverse retail trade industry plays a vital role in the state's economy. This industry includes businesses engaged in reselling merchandise or services in small quantities to the general public. Retail establishments can take the form of a physical store or a "nonstore" where business is conducted via the internet, broadcasting, door-to-door, or vending machines.

The retail industry employed 196,000 Oregonians in 2008, 13.6 percent of the state's private employment. Total payroll was almost $5 billion. Leading subsectors in terms of employment include general merchandise stores, food and beverage stores, motor vehicle dealers, apparel stores, and building material and garden supply stores. Although the retail industry has a high share of the state's employment, its average pay is lower than that of many other industries. Retail's average annual wage in 2008 was $25,489, compared to the statewide average of $39,974 across all private industries. Among the industry's major segments, annual average pay varies from a low of $16,696 for gasoline stations to a high of $39,263 for motor vehicle and parts dealers (Table 1).

Average annual employment in Oregon's retail sector grew by almost 30 percent between 1990 and 2008, adding nearly 45,000 jobs statewide (Graph 1). During this period, average annual employment peaked in 2007 at 200,700, before dropping in 2008. Nationwide, employment in this sector has grown by only 16.5 percent since 1990, rising from 13.2 million employees to 15.4 million in 2008. In Oregon, growth occurred across all the major retail subsectors during this period, most notably building materials and garden supply stores which grew by 62 percent, from 9,400 in 1990 to 15,200 in 2008.

While historical growth has been high, retail has not fared as well during the current economic downturn. Between August 2008 and August 2009, the industry lost 11,700 jobs, a decline of 5.9 percent. Year-over-year growth in August 2009 was negative across all subsectors. Clothing and clothing accessory stores fared the worst with a decline of 17.1 percent, while food and beverage stores performed relatively well, with a decline of 1.8 percent.

Areas with larger populations tend to make up a greater share of the state's retail employment. This is not surprising; the more people living in an area, the greater the demand for consumer goods such as food, clothes, gasoline, and furniture. Also, more densely populated areas tend to have larger supply networks, increasing the variety of goods made easily available to consumers. In 2008, nine of the 10 Oregon counties with the largest retail presence were also among the top 10 in population. Average wages for retail employees tend to be higher in these counties as well (Table 2).

The most common occupation within the retail industry - salesperson - accounts for 27 percent of all industry employment (Table 3). Cashiers constitute 15 percent. Other leaders include supervisors and managers, stock clerks, attendants, packers, laborers, bookkeepers, food workers, and automotive technicians. Of these jobs, service station attendants receive the lowest average annual wage statewide at $20,405. Supervisors and managers receive the highest average annual wage statewide at $40,169. With the exception of supervisors and managers and automotive service jobs, all of Oregon's top 10 retail jobs pay less than the statewide average wage for all private industries.

There are roughly an even number of men and women employed in Oregon's retail industry (Graph 2). Overall, women comprise nearly 51 percent of workers and men 49 percent. This gender parity is consistent across most age groups. Workers, both male and female, aged 25 to 34 years make up the greatest percentage of the workforce at 22 percent.

Men earn larger average monthly salaries across all age categories in the retail sector. Recent average monthly earnings for men in this industry in Oregon were $2,828 while women earned an average of $1,914 monthly, a difference of 48 percent. Men ages 45 to 54 earned the highest average monthly salaries at $3,685 per month (Graph 3). For women, the highest average monthly salary was earned by those between 35 and 44 years old at $2,316.

Despite current economic conditions, many in the retail industry remain cautiously optimistic about its present state and future recovery. Statewide retail employment figures for July and August 2009 (185,900 for both months) are the highest they have been since December 2008, although still down significantly compared to their respective months last year.

The Bend metro area in particular is a bright spot for the industry. Although this region has felt the impact of the current recession especially hard as a result of the housing market collapse, retail seems to be weathering the storm relatively well. Between August 2008 and 2009, the Bend metro area lost 2.8 percent of its total retail employment, less than the other major metro areas across Oregon or the state as a whole. "We have been very proud of our overall resiliency," says Chuck Arnold, Executive Director of the Downtown Bend Business Association. "Vacancies have definitely increased over the past few years but compared to other downtowns, we are not doing so bad ... we realize we are going to rebound relatively well."

Even in the current economic environment, retailers see numerous opportunities to reach a new type of consumer, one who is more price conscious but still values quality and style. "Our business model has changed, our average price point is lower," says David Whitehouse, co-owner of Sloan Boutique, a women's designer apparel shop in northwest Portland. Sloan now clearly marks racks of clothing with signs indicating all items are "below $40 dollars," "below $50 dollars," etc., to better target this growing customer segment. It also hosts special in-store events with free refreshments and discounts to demonstrate the affordability of its items to customers. The boutique's approach has paid off. "We actually expanded at the end of last year (2008). We have come up with creative ways to show our prices are affordable," Whitehouse says.

Retailers also see opportunities to provide products and services that help customers get back to the "basics" and live a simpler, more affordable lifestyle. "Customers are doing more cooking themselves so we are selling more in-house baking items, such as small appliances. You adjust inventory to accommodate," says Jan Oswald, owner of Gourmet and Gadgets, a kitchen products and gift store in Burns. "People are more conservative and buy things they need, not the things they might like to have."