While almost every industry has been cramped in the last few years, the dollar economy has been exploding. Dollar General has created more than 21,000 jobs since 2009, and just announced that it will open 625 stores and hire another 6,000 workers in the next 12 months, according to a press release. Dollar General already has over 9,800 stores in 38 states.
This rise of ultra-discount retail may be more than a temporary symptom of the recession. Things are finally looking up for the economy; the number of people seeking unemployment benefits last week was the lowest in over 3½ years. It seems something more seismic may have happened to our consumer culture. The Bush era "spend what you don't have for what you don't need" ethos has been ditched in favor of a fervent thriftiness, bred by years of economic uncertainty.
In this new world, "dollar stores have been one of the clear winners," according to a December 2011 report by Colliers International, which provides commercial real estate services. There are 21,500 such stores in the U.S., split among the four big chains: Dollar General, Family Dollar, Dollar Tree, and 99 Cent Only stores. Between 2007 and 2010, Family Dollar's net sales grew 15 percent and Dollar General's increased by 37 percent. All these stores are boldly expanding their offerings, particularly in the consumable category.
But the jobs that these stores bring to communities may come at a cost to employees at other retailers. In December, Sears Holdings Corp. announced plans to close between 100 and 120 Sears and Kmart stores. Walmart's U.S. same-store sales have been on a decline for the past nine quarters.
Some more upscale chains, however, have caught onto the new consumer. Macy's Inc. is closing five Macy's and four Bloomindale's once their 10-week clearance sales end, affecting 830 workers. But by the end of 2013, the company says that it will have hired over 1,000 employees at their new locations, including five new Bloomingdale's outlet stores, which sell merchandise at a 35 to 70 percent discount, reports Daily Finance.
Ann Taylor, Nordstrom, Neiman Marcus and Saks Fifth Avenue have also been bullishly expanding their low-price spinoffs. In November, more than a third of the new jobs were created in retail, according to a Labor Department report. Retail is the engine of the American workforce, and dollar store retail is becoming a very powerful fuel.
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