The grocery sector found itself on the front lines of the pandemic a little over a year ago. Retail staff were suddenly thrust into a “hero” role (with a similarly titled “hero pay” wage bump), as they worked to keep shelves stocked and raced to keep up with unexpected e-commerce demand.
Talking Point
A new report from the Brookfield Institute tracks how the pandemic changed an already shifting grocery industry by speeding up e-commerce adoption and what the increased reliance on tech means for workers. Hint: humans are still required, but the jobs aren’t seen to be as good as they once were.
A new report from the Brookfield Institute reveals how the pandemic has accelerated the digitization of food retail, and its lasting impact on workers. Here’s what you need to know:
Spending on food: The average Canadian household spends $10,311 on food a year, with nearly three-quarters of that at grocery and food retail, like convenience stores. In 2019, they spent the most, $28.3 billion, at Loblaw brands, followed by Empire ($21.9 billion), Metro ($11.8 billion), Costco ($8.8 billion) and Walmart ($8.2 billion). Food costs are rising: people spent an additional $695 the same year.
A part-time job: In Ontario, 130,140 people work as cashiers, with the majority—54 per cent—being between 15 and 24 years old. Another 68,980 people work as shelf stockers, and 44 per cent of them are in that same age range. Only 20 per cent of cashiers and 32 per cent of shelf stockers work full time. Between 2006 and 2016, full-time positions at grocery stores fell by 15 per cent. Just 20.5 per cent of “sales-support occupations” are unionized.
Money, money, money: The median hourly wage range begins at $14.25, the current minimum wage in the province, for both positions. It goes to $18.35 for shelf stockers, who are majority male, at 68 per cent. The median range for cashiers, who are 82 per cent female, tops out at nearly $2.50 less, at $15.87.
Shop (online) ’til you drop: In 2019, only one per cent of all food-retail sales in Canada were online—well behind Europe and the U.S. Since the start of the pandemic, online sales in the country have grown 700 per cent. Canada’s big three grocers—Loblaw, Empire and Metro—as well as other brands and small independent businesses are investing lots into e-commerce.
How it’s done: Two options exist for how grocers have implemented online shopping and delivery. Food selection can be done in store or in a warehouse, which tends to be more automated, like Empire’s Ocado partnership. Delivery, meanwhile, can be done in-house or outsourced to a third-party company, such as Instacart.
Grocery workers’ side hustles: The rise of these delivery companies offers a new potential source of income for grocery workers, many of whom struggle to make ends meet on their retail wages. Some grocery workers in the Greater Toronto and Hamilton Area have turned to the gig economy in addition to their retail jobs. Some earned higher hourly wages on these platforms and reported enjoying the flexibility.
Big Grocer: Loyalty programs have become increasingly important because of their valuable data insights that can drive sales. Loblaw’s PC Optimum program, for example, has roughly 18 million members, and the grocer is increasingly compared to a tech company. It has a digital arm, an affiliated venture capital firm and recently purchased a digital adtech firm to boost its marketing division, Loblaw Media. The rise in e-commerce adoption, partly thanks to the pandemic, has helped grow both loyalty memberships and, subsequently, the data they deliver.
Consolidation challenges: With some grocers commanding a good chunk of sales and data, they also get the power to “set prices, engage with suppliers and access capital.” Retailers increasingly pass new business costs, like e-commerce investments, onto suppliers by levying additional fees. Smaller retailers and food manufacturers suffer as a result. Issues such as these have heightened calls for a national code of conduct.
Humans still wanted: With an increase in in-store technology, like self checkouts and e-commerce, which comes along with automated warehouses, there have been questions about whether retail workers will lose jobs. Demand for humans to work is still high, the report found, but it can be difficult to find people at the existing wages and conditions. Companies want people who care about good customer service (the thing robots and algorithms can’t quite do) and people to help pick, pack and deliver all those online orders.