Few sectors of the economy have been as affected by Covid-19 as the retail sector, with most non-food stores forced to close for extended periods, shifting demand online, while food-based retailers enjoyed booming sales as people attempted to stock up (while obviously not eating out quite so much either).

New research from UC Santa Cruz explores how the pandemic has changed the very nature of the retail workforce, with a particular focus on the food retail sector.  As with so much, the authors argue that the pandemic has accelerated many of the labor market trends that had been emerging in recent years.  For instance, e-commerce had been a growing presence in the grocery sector, which created a number of implications for workers.

“The growth of e-commerce sales for food has increased the number of jobs available at a time when unemployment across the U.S. economy has skyrocketed. Grocery workers now are seen as essential workers, even heroes,” the researchers say. “At times they even have received extra hazard pay. And yet media reports also are full of stories of ongoing low wages and poor working conditions, severe health risks, and employer retaliation against workers who speak out.”

Making the transition

The report reveals the scale of this transition, with 45% of households having ordered groceries online during the pandemic, with many of these having done so for the first time. They highlight that many grocery chains have seen online sales triple from last year.

This has inevitably created new jobs, but the report highlights that many of these have been platform-based, which can often mean workers are lower paid and lacking the employment protections and benefits that their permanent peers enjoy in-store.  It’s a transition that the researchers had been monitoring for some time, but it obviously took on fresh importance during the pandemic.

“This became even more important in the context of the pandemic because these are essential workers,” they explain. “They’re helping to get food to people sheltered in place at home. They’re putting themselves at risk in fulfilling and delivering food orders. And I think our findings highlight the inequalities and problems that exist in some portion of the grocery and food delivery industry.”

While the transition during the pandemic has been profound, the question remains whether it’s a change that will endure. Will jobs continue to expand beyond the pandemic? What kind of wages and working conditions might exist across the various parts of the retail landscape? What changes might befall those in traditional grocery store jobs?

A changing landscape

Some of the underlying factors that underpin this change will inevitably recede, but the continued growth in e-commerce spending in the sector is likely to endure.  What the report clearly points out, however, is that e-commerce has not been the job killer that many in the sector feared.  Rather, the growth in e-commerce has led to a wave of new jobs as customers began paying for things that previously they would have done for free.

Areas such as collating items for order fulfillment have boomed, as have putting together parts of the meal preparation process for customers or the facilitation of curbside pickups and delivery.  This has coincided with a general decline in cashier positions, but if looked at holistically, the number of jobs in the sector has risen during the pandemic.

What is a concern, however, is the overall quality of the new jobs that have been created. The report highlights that most of the delivery and fulfillment work is done by platform-based workers who are usually hired as independent contractors, which results in lower pay, no employment protection, and limited access to benefits.

What’s more, the authors also highlight the increasing surveillance and algorithmic management that such workers are subjected to, which can significantly impact their mental health. This is especially so as work schedules can be unpredictable and unsociable.

New labor models

Obviously the labor conditions of on-premise staff have emerged over many decades, so it’s quite possible that those of platform-based staff will emerge in the years to come too.  The report argues that a range of labor models are emerging that they believe could maintain job quality.

For instance, among larger store chains, they cite examples of in-house, unionized employees doing the kind of fulfillment and delivery tasks that are done by platform-based workers elsewhere.  These workers obviously enjoy the same protections and higher wages enjoyed by their in-store colleagues.

While the gig economy has largely enjoyed un-regulated growth in its formative years, the emphasis on the key role grocery workers played during the pandemic is likely to accelerate attempts to regulate the sector to ensure that all workers in the value chain get treated fairly.

Obviously, this is likely to be an uncertain process, as evidenced by the passage of Proposition 22 in California, which exempts platform-based workers from any state employment protection.  The authors believe that legislation to narrow classifications for independent contractors coupled with the continued expansion of access to benefits and health coverage could allow the e-commerce sector to continue growing while also providing fair protection to workers.

“There’s a popular misconception that it’s inevitable that technology will impact the workforce, but that hides all the decisions and choices that are made within that,” the researchers conclude. “Technology can change things in pretty dramatic ways, but it’s still shaped by political forces, business forces, cultural norms, and human tendencies.”