As the economy went south in 2007, second-hand stores began attracting more customers. As consumers cut back on spending, many turned to used merchandise as an alternative to new, more expensive goods. This trend appears to be continuing during our current expansionary cycle.
Although it's not a heavyweight in the world of retail trade - in 2012, used merchandise made up 0.3 percent of all retail trade sales nationwide - the industry is growing rapidly. National sales at these stores have steadily increased over the past two decades, and there's been a significant rise in recent years.
Total retail sales, excluding vehicles, grew at a considerably slower pace since the industry's pre-recession peak in December 2007. Resale spending increased by 19.5 percent between December 2007 and December 2013 (Graph 1), nearly six percentage points more than all non-auto retail.
The most common jobs in the industry are retail salespersons, cashiers, laborers and stock movers, and supervisors. These jobs tend to pay lower than average wages; statewide they averaged just under $30,000 in 2013. As with most retailers, employees are likely hired on a part-time schedule, and it's also possible that there may be higher turnover, both of which would result in lower earnings.
Although retail spending rises during the holidays, Oregon's seasonal hiring pattern is overall pretty weak in the used merchandise sector, according to covered employment data. However, a noticeable build-up can be seen in the late summer to early fall season, perhaps reflecting increased sales around the back-to-school season.
Given the nature of this industry, there are likely many Internet and home-based ventures: think e-Bay sellers, estate sale organizers, or antique dealers. These companies are called nonemployers, and include the self-employed, businesses without employees, independent contractors, and others.
A measure of this group, published by the Census Bureau's nonemployer statistics program, shows that Oregon had 876 establishments in the used merchandise industry in 2011, comprised mainly of individual proprietorships (829), a few partnerships, and a handful of corporations. These data also reveal that nonemployers had receipts of nearly $29 million in 2011, which include sales, commissions, and other income reported on annual business income tax returns.
Although many nonemployers may not advertise, there are plenty of new companies throughout the state. Looking over the dozens of resale business opening announcements in Oregon over the past year reveals a couple of themes in their wares: used household goods, like sporting equipment and furniture; and antique collectibles, such as dishware and jewelry.
Portland in particular has a reputation for stylizing thrift and emphasizing the recycled aspect of used goods. Many recently opened second-hand shops in the Portland metro area have been upscale clothing businesses. According to America's Research Group, this trend may be due to young shoppers. Consumer research companies like the Zandl Group say that today's teens and young adults value unique and original styles, which often leads them to favor vintage and retro clothing or décor. With one of the youngest populations in the state, it's no surprise that Portland has a large market for thrift stores.
As a result, one might consider the Portland metro area the resale capital of the state, as the region was home to over two-fifths of the covered establishments in 2012. However, as shown in Table 1, the Willamette Valley has slightly more than Portland in terms of employment; other metro areas around the state also have a resale presence.
|Oregon's Used Merchandise Industry|
|2012 Geographic Employment Trends|
|Region||Employment||Number of Firms||Average Annual Wage|
|Source: Oregon Employment Department, Quarterly Census of Employment & Wages|