Retail sector employment additions decelerate
Retailers added 12,100 jobs in April 2015, down from 35,400 in January, 23,100 in February, and 24,500 in March[1. Bureau of Labor Statistics]. Excluding automobiles, gas stations, and restaurants, retail sector employment rose by 9,200 in April. Total employment in retail trade (RTH) has risen by almost 285,000 over the past 12 months.
The unemployment rate for wholesale and retail trade combined was 5.6% in April 2015, compared to 5.9% a year earlier[1. Not seasonally-adjusted].
Retail sector payroll additions
Overall, the picture was mixed for different industries in the sector. Food and beverage retailers (XRT) (XLP) added 3,600 jobs in April, the largest payroll increase in the retail sector. The stock price of Kroger (KR), the largest US grocer, rose by 1.6% to $71.79 on May 8. KR’s competitors in the grocery space, Walmart (WMT) and Costco (COST), rose by 0.6% and 0.9%, respectively.
The First Trust Consumer Staples AlphaDEX ETF (FXG) has ~24.3% of its holdings invested in food and staples retailers, including Kroger (KR). Constellation Brands (STZ) is the top holding of FXG, with a 4.8% weight.
Non-store retailers added 2,100 jobs in April, while building material and garden supply stores and furniture and home furnishing stores added 2,800 jobs and 1,500 jobs, respectively. This benefited the stock prices of companies like Home Depot (HD) and Lowe’s (LOW), as discussed in the last article. Other stocks benefiting on May 8 included Amazon (AMZN), the largest US e-retailer, which rose by 1.6%.