Texas retailers are optimistic heading into the critical holiday shopping season, but they are worried about the impact of rising employment costs on their bottom line moving forward, News Radio 1200 WOAI reports.
The retailers were surveyed by the Federal Reserve Bank of Dallas as part of its regular study of business trends.Retail sales accelerated in August, with most stores reporting solid gains in the 'back to school' shopping season, which has become second only to the holidays in importance to retailers.
Retail employment accelerated and workweeks lengthened this month. The employment index picked up from 3.3 in July to 9.8 in August, with the part-time employment index jumping to a postrecession high of 14.0. The hours worked index rose nearly 13 points to 13.4.
Even though retailers continue to be optimistic, they are starting to worry about price and wage pressures caused by the shortage of workers.
The Fed's 'wages and benefits index' surged to a new high in August, as workers are putting in more hours to deal with increased customer traffic.
But the survey shows retailers expressing concerns that these wage pressures could force them to raise prices, which could make them less competitive with on line competitors.
'Uncertainty' is showing up more and more in retailers perceptions on the future, with the index of 'future general business activity' showing its first drop in several years, and the 'outlook uncertainty index' showing its highest level ever.
But there is still optimism, with many retailers expecting that customers will continue to come into their stores and continue to open their wallets in the coming several months.
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