Profits and losses
BUSINESS | Rising retail theft cuts ever deeper into bottom lines
Full access isn’t far.
We can’t release more of our sound journalism without a subscription, but we can make it easy for you to come aboard.
Get into news that is grounded in facts and Biblical truth for as low as $3.99 per month.
Current WORLD subscribers can log in to access content. Just go to "SIGN IN" at the top right.LET'S GO
Already a member? Sign in.
When retailers released their second-quarter earnings results in August, they sounded an alarm over increased theft and damage to stores.
Executives from more than a dozen retailers across a variety of markets—from home improvement to sporting goods, discount and department stores, and beauty products—said “inventory shrink,” the industry’s Orwellian phrase for lost or stolen merchandise, was to blame for lower-than-expected profits. Dick’s Sporting Goods said Aug. 22 its income was down 23 percent despite sales revenues being up 4 percent over the same period.
Retailers have previously warned about the increasing financial impact of shoplifting and organized retail crime, but Nordstrom CEO Erik Nordstrom said losses are at historic highs. Some 30 thieves stormed one of the upscale retailer’s Los Angeles–area stores Aug. 12, stealing up to $100,000 in inventory.
Retailers are trying to slow the shrink. Lowe’s added radio-frequency ID technology that makes theft-prone power tools inoperable unless scanned. In many cases, though, stores are just increasing their frequency of inventories and accounting for greater losses in quarterly projections.
Big-box stores and chain restaurants—long derided for forcing out local, independent stores and eateries—contribute the most to mixing of economic classes, according to an August preprint study released on the open access website SSRN. Researchers analyzed cell phone data from the first half of 2022 to compare where people live to where they shop, eat, and visit public or civic spaces.
The places that contributed most to the mixing of economic classes were large, affordable chain restaurants like Olive Garden and Chili’s, and retailers such as Walmart. Civic spaces like churches, schools, and museums tended to be more socioeconomically isolated. The researchers from the Naval Postgraduate School and Harvard University recommended city planners reconsider existing zoning rules that favor local establishments over chain retailers, pharmacies, and restaurants if they want to encourage more diverse neighborhood development. —T.V.
Highly priced hires
The amount of money most workers now want in order to switch jobs reached a record high of nearly $79,000 this year, according to a survey by the Federal Reserve Bank of New York. The data released Aug. 21 is consistent with an Atlanta Fed tracker that shows wages overall rising by 6 percent annually, with job switchers seeing 7 percent gains. Wage growth is increasingly thought to be correlated with inflation trends. —T.V.
If you enjoyed this article and would like to support WORLD's brand of Biblically sound journalism, click here.