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When Personalized Service Collides With Staffing Cuts

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Urban Planning Professor Chris Tilly spoke to Forbes about staff cuts at Petco, whose business model relies on drawing customers into brick-and-mortar stores for services such as grooming, training and veterinary care. The staffing reductions come as Petco announced that it would be far less profitable this year than previously expected. “It’s ironic because Petco, like lots of other retailers, is saying our competitive advantage is we have stores where you can actually talk to somebody and they know your pet’s name,” said Tilly, co-author of  “Where Bad Jobs Are Better: Retail Jobs Across Countries and Companies.” “But it’s completely at odds with what they’re actually doing with their staff.”

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Tilly on Working Conditions in the Retail Sector

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Urban Planning Professor Chris Tilly spoke to Boston Globe Magazine about working conditions in the retail sector, particularly at supercenters that attract consumers with discount prices made possible in part by keeping employee wages low. “In the 1960s into the early 1970s, working in retail really was a decent job,” said Tilly, co-author of “Where Bad Jobs Are Better: Retail Jobs Across Countries and Companies.” That changed due to a number of factors, including the increasing desirability of part-time positions. “Retailers figured out they could offer half the wages and none, or some, of the benefits,” Tilly said. Now, “the dominant model has been a low wage, high turnover, low benefits and increasingly crazy schedules.” Market forces, including pandemic-era labor shortages, have pushed retailers to improve working conditions, but those gains could be reversed if employers regain the advantage.

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Rowe Says S.F. Moratorium on New Pot Shops Could Hurt Customers

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UCLA Luskin lecturer Brad Rowe recently commented on a decision by the San Francisco Board of Supervisors to create a moratorium through 2028 on new applications for retail cannabis licenses in the city, describing it as “old-school protectionism” of retail license holders. California’s entire cannabis industry is struggling to stay profitable and this action could help retailers, but Rowe told SF Gate it is likely to increase prices. “There is a way to build value by restricting access,” Rowe said. “The problem is who is going to pay for it? Consumers are the ones who are going to pay with higher prices.”

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Tilly on Costco’s Labor Policy

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Urban Planning chair Chris Tilly appeared on Yahoo Finance Live to discuss Costco’s labor policy and the impact of the Teamsters Union reaching a contract with the big-box retailer. Tilly was asked about the increasing pressure on Costco as some competitors raise employee benefits — and prices — to try to be more competitive. “I think that there’s two sources of pressure. One is, in fact, that competitor pressure,” Tilly said. “Nonetheless, there’s also a source of pressure because as inflation goes up, workers’ expenses go up. And Costco has to keep pace with that.” As an example, Tilly explained that, during negotiations, Costco offered a settlement that workers turned down in August, threatening to go on strike. “And so I think that’s the other source of pressure. And that’s going to continue, both because inflation is continuing and because right now the worker shortage is continuing.”

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Tilly on Retail Workers’ Fight for Better Conditions

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Grocery Dive spoke with Urban Planning chair Chris Tilly about evolving labor dynamics in the supermarket industry and other large retailers. Energized by a pandemic-spurred labor shortage, workers and labor advocates have made progress in their quest for better working conditions, including higher pay, guaranteed hours, and stronger health and retirement benefits. However, in an age of declining union membership and pressure on businesses to hold down expenses, it will be difficult for workers to make significant long-term gains in their relationships with large companies, Tilly said. In the past, publicly traded retailers were often controlled by families that could make workers a priority, but today they frequently answer to large-scale investors, like mutual fund managers, who are focused on quarterly results, he said. “Shareholders trying to squeeze dividends and increase share price … shifted the balance of power within public companies,” Tilly said.

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Tilly Wins Award From Labor Relations Group

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Urban Planning chair Chris Tilly has been named a 2022 Academic Fellow by the Labor and Employee Relations Association (LERA). The award, which recognizes scholars who have made contributions of unusual distinction to the field of labor and employee relations, was given at the association’s annual membership meeting, held virtually from June 3-5. Françoise Carré of the University of Massachusetts, Boston, was also honored with an Academic Fellow award. Tilly and Carré are co-authors of the award-winning 2017 book “Where Bad Jobs Are Better,” which identifies room for improvement in the U.S. retail sector. Citing a rigorous study of working conditions in seven countries, the authors conclude that low wages, unpredictable work schedules and limited opportunities for advancement are not inevitable characteristics of the retail sector. Tilly and Carré also collaborated on a chapter in 2020’s “Creating Good Jobs: An Industry-Based Strategy.” The LERA Academic Fellow awards are given annually to scholars who have served more than 10 years studying disciplines including industrial relations, labor law, economics, human resources, business, sociology, political science and organizational behavior. The nonprofit association also bestows Fellow Awards on practitioners in the labor and employment relations field. A full list of the award winners is available on the LERA site.

 

Tilly Analyzes Restructuring of Best Buy

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Urban Planning Chair Chris Tilly spoke to Retail Dive about the internal reorganization of Best Buy following a recent large wave of layoffs. The company has been struggling to compete against generalist stores, such as Walmart and Target, as well as Amazon. Over the last decade, Best Buy said it prized a “human-centric approach” focusing on the company’s front-line workers, but it recently cut many full-time employees in favor of part-time staff who are expected to be knowledgeable about all areas of the store. “It’s clear that the entire store-based consumer electronics industry has faced incredible pressure from online sales,” Tilly said. “The fact that Best Buy survived and bounced back is miraculous, when a lot of other companies were going down.” The pandemic made competition even tougher by shifting more things online. “If you’re just competing with online sales, what is the difference between Best Buy and Amazon?” Tilly asked.

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Tilly on the Intrusiveness of AI Technology

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Urban Planning Chair Chris Tilly was featured in a Fox32 news segment about the growing use of artificial intelligence technology in the food industry. Many stores such as McDonald’s and Amazon Go are testing drive-thru and AI invisible checkout systems. Tilly explained that these new technologies have an impact on both consumers and the workforce. “To some extent, workers are being replaced by this technology,” he said. “At the same time, the expansion of services like curbside pickup means that workers are being added.” While the workforce may be balanced out by the expansion of these new technologies, Tilly noted that the services can be very intrusive for consumers. “Artificial intelligence is always on, always tracking what people are doing,” he said. While the Amazon Go model has currently only been implemented in small stores with many sensors and cameras, Tilly predicted that technology will most likely allow companies to expand these services in the long run.

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Tilly on What It Will Take to Improve Retail Jobs

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The U.S. retail industry has been rocked by COVID-19, but the momentary spotlight on essential workers shows little sign of bringing lasting improvements to their work lives, according to an article co-written by Urban Planning Chair Chris Tilly. Only regulatory pressure promises to strengthen protections for retail workers, Tilly and co-author Françoise Carré concluded in the piece for the Good Companies, Good Jobs Initiative. The COVID-19 shutdown, along with rapid technological change, has triggered high levels of unemployment and undermined employer interest in basic job improvement measures, they wrote. On the tech front, “the e-commerce boom is most obvious, but a less visible — and quite ominous — shift is the spread of worker surveillance,” which has led to complaints that faulty systems have been used to discipline employees unfairly. Tilly and Carré are co-authors of the 2017 book “Where Bad Jobs Are Better” and collaborated on a chapter in 2020’s “Creating Good Jobs: An Industry-Based Strategy.”

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Tilly Sees Opportunity for Retail Workers to Voice Concerns

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Urban Planning Chair Chris Tilly was featured in a WWD article about the challenges facing front-line and retail workers during the pandemic. Big companies like Walmart and Amazon have made efforts to compensate their workers and institute safety measures, including staggering breaks, handing out protective gear, and offering one-time bonuses and temporary raises for employees. However, front-line workers still face increased risk of exposure to COVID-19 while working for low hourly wages and managing additional responsibilities. According to Tilly, highlighting inequalities has been one way worker advocacy groups have sought to frame the discussion, keeping the attention on workers speaking out about pay and safety issues. “Even though most retailers have backed off the hazard pay, or limited it to sort of one-off bonuses, there is, I think, in the general public a renewed respect for this workforce,” Tilly said. “I think that creates an opportunity … to advocate more for protections but also for more voice.”

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