A few odds and ends from the labor market and retailing.
First off, we won’t see the state’s labor market (unemployment) report for January until March, followed by the February stats later in the month. The state’s jobless rate is likely to remain fairly steady.
The timing of reports has to do with a short month and labor market figures being revised to reflect payroll figures rather than the estimates typically used in monthly reports.
In Delaware and other states, we sometimes see sizeable revisions. A while back, job reports pointed to a drop in retail employment despite little evidence of big layoffs.
Retail has been affected by the closings of big box stores like Bed Bath and Beyond, Kmart, and Sears, although the state’s tax-free status leads to newcomers entering the market.
Still, the recent announcement that Macy’s plans to close 150 stores could affect Delaware, although no specifics were offered.
While the store in the destination Christiana Mall is safe, stores at Dover and Concord malls could be on the bubble. The two stores could hang on, thanks to Delaware’s sales tax-free status. Macy also opened one of its Bloomingdale’s off-price stores at the nearby Christiana Fashion Center.
Higher mall vacancy rates like the ones we have seen at Concord and Dover affect anchor retailers like Macy’s, which indicated it will open smaller stores in open-air “lifestyle centers” like the one near Christiana Mall.
Next up was news this week that the Biden Administration will oppose the merger of Safeway and Acme owner Albertsons and Kroger.
Opposition from unions probably played a role in the decision as the 2024 election approaches in an administration that, unlike its Democratic predecessors, has not kept unions at arm’s length.
There are also concerns that once the companies merge and unload stores in areas where monopoly issues are apparent (mainly out west), further cuts will come to states like Delaware.
Unionized Kroger and Albertsons have virtually no overlap in Delaware. However, the fear is that the combined company will close more marginal stores once the dust settles.
Acme stores in northern Delaware have long been the subject of rumors. Acme-Albertsons did close a Safeway store in north Wilmington a few years ago, despite some neighbors preferring the California-based grocery store. Acme also exited the Dover market, where it had one store, and chose not to add another. Redner’s stepped in to fill the gap followed by Aldi and Lidl. Walmart is also an “800-pound gorilla” in the central Delaware market.
With Wegmans, Aldi, and others moving into a crowded market, it is possible, with or without the merger, that Albertsons will decide to become a more profitable company in New Castle County by shuttering stores, even if it means lost market share.
Customers already complain that store makeovers come too rarely at Acmes, although it did complete a badly needed renovation at its store at the Grove in Newark.
Acme has lost market share over the decades but slowed that slide by adding Safeway and picking up a few former Pathmark stores. – Doug Rainey, chief content officer.
