By Jenn Hahn is the Founder & CEO of J Recruiting Services

Retail has always been a game of margins. With tariffs adding even more pressure to already tight budgets and another layer of complexity to retail operations – companies are making strategic decisions. The tariff conversation is, again, forcing retailers to rethink where they invest and where they cut back, compelling retailers to reassess their operational and hiring strategies to maintain profitability. This shift requires a fresh approach to recruiting talent. Retailers are implementing innovative measures to mitigate tariff impacts while striving to attract and retain top talent.

Corporate Shrinkage, Frontline Growth

From our seat, we see that retail corporate teams are feeling the squeeze. As tariffs push costs higher, companies are making tough decisions about headcount, and in many cases, that means smaller corporate teams. Marketing, HR, Finance and other support teams are being consolidated rather than having those headcount requests approved each time they have a new initiative. 

On the flip side, leadership roles in stores, distribution centers, and the overall supply chain are seeing steady demand. Retailers recognize that strong in-store management is key to keeping operations smooth and customer experiences strong, especially as economic pressures mount. Strong store leaders are more essential than ever as technology rollouts continue in stores. A store leader is no longer just responsible for making sure the store is stocked and staffed, they’re now leading more pilot programs than ever and operating as an analyst in many capacities to assess programs and gaps in process. Similarly, with supply chain disruptions and cost increases, logistics professionals are more valuable than ever. Customers and regulatory agencies are tightening demands on quality and retailers are relying on top supply chain leaders to keep pace. Companies that fail to invest in these areas risk losing ground to competitors who are doubling down. 

Here’s how the industry is responding—and how businesses of all sizes can adapt. 

Supplier Negotiations and Alternative Sourcing

Retail giants are renegotiating terms with suppliers and vendor partners to share the burden of increased costs. According to Reuters, Walmart and Target have engaged in discussions with suppliers to prevent immediate price hikes on merchandise affected by tariffs. This collaborative approach seeks to maintain price stability for consumers while managing supplier relationships. Additionally, companies are exploring alternative sourcing options. 

Companies are also exploring alternative sourcing strategies. Costco, for instance, is considering alternative sourcing locations and working closely with its vendors to find ways to mitigate tariff impacts. As noted by Costco CEO Gary Millerchip in December 2024  (Quartz), the company is focused on reducing costs and diversifying sourcing options to navigate these challenges.

As a trusted partner in the talent space, we’ve seen more retailer partners engaging with us in conversations about negotiating services and rates to adapt to changing market dynamics. A more agile pricing model and predictable costs, where possible,  help foster ongoing collaboration and a win/win in this new landscape. The retailers that are doing it right are working with vendor partners that understand the industry and the evolution from where we were to where we’re going.

Embracing AI and Automation

The integration of artificial intelligence (AI) and automation is playing a pivotal role in offsetting increased operational costs due to tariffs. Retailers are investing in AI-driven analytics for demand forecasting, automated inventory management systems, and customer service chatbots. Some of those teams who are being asked to do more with less can now use AI to take on administrative tasks and a single human can be more effective. These technologies enhance efficiency, reduce labor costs, and allow companies to reallocate human resources to more strategic roles, thereby maintaining profitability amidst external pressures. AI allows companies to use their talents in the most strategic way, therefore shaping how and where they need to recruit top talent.

Focused Talent Acquisition

Despite budget constraints and corporate squeeze, some retail roles remain mission-critical:

• Supply Chain & Logistics: Skilled professionals who can optimize sourcing, reduce shipping costs, and improve distribution efficiency. To get top talent in your supply chain, it takes proactive strategy, this is the area we’re seeing retailers invest in partnership.
• Store Leadership: Strong managers who can drive operational excellence, increase employee engagement, and improve customer experience all while managing the many new technologies sent their way are mission critical. Strong store leaders are sought after and compensated at a higher rate than even just two years ago.
• Technology & Data Analysts: Specialists who can leverage AI and automation to improve efficiency and manage cost pressures. Many retailers are investing in building out their own AI models for security reasons. They need those tech savvy leaders to jump in and support the build, maintenance, and analysis of these models.

Winning in a Tight Talent Market—Even on a Budget

With hiring budgets under scrutiny, retailers must be more intentional about their talent strategies. Both big and smaller retailers need to hire smart, not big. Instead of expanding headcount, Here’s how retailers can stay competitive:

1. Prioritize High-Impact Roles – Rather than spreading hiring dollars thin, retailers are  focusing on roles that are mission critical in 2025. Investing in strong store managers, distribution center leadership, logistics experts and data gurus will have a greater impact on the bottom line than simply adding headcount to all teams across corporate functions. 
2. Leverage Internal Mobility – Promoting from within not only saves on hiring costs but also strengthens employee retention. Developing structured training programs to upskill existing employees can be a cost-effective way to fill critical leadership roles. 
3. Rethink Compensation Packages – While budgets for salary may be constrained, companies can stay competitive in those mission critical roles by offering the high compensation packages but save by consolidating roles in other areas of the business where technology has taken over admin tasks. 
4. Streamline the Hiring Process – A lengthy hiring process can drive top candidates elsewhere. Retailers need to ensure their recruiting process is efficient, fast, and candidate-friendly to secure the best talent before the competition does. Each hour your team spends in interviews without a hire being made is costly. Evaluate the cost of vacancy and get the right person in the door quickly. 

The Demand for Top Talent Isn’t Going Anywhere

Even with budget constraints, one thing remains clear: top talent is still in high demand. The best employees—those who can drive profitability, navigate change, and lead teams effectively—will always have opportunities. Companies that recognize this and adapt their hiring strategies accordingly will come out ahead.

The key is to be proactive. Retailers that wait too long to adjust to shifting market dynamics will struggle to attract and retain the people they need to keep up. The brands that win in today’s hiring landscape will be those that invest smartly, streamline processes, and focus on roles that truly move the needle.

Final Thoughts

Tariffs are forcing every retailer—big and small—to rethink their hiring and workforce strategies, but the need for great talent hasn’t changed, it’s evolving. While big-box stores are flexing their supply chain muscle, smaller businesses have opportunities to pivot and build resilience. By adapting hiring priorities, leveraging automation strategically, and staying competitive in a tight talent market, retailers can position themselves for long-term success. The key is investing in the right talent, technology, and partnerships to stay competitive.

The bottom line? Retailers who adapt strategically will come out ahead. Those who don’t may not be around to compete.

About author

Jenn Hahn is the Founder & CEO of J Recruiting Services, a boutique recruiting firm that partners with leading retail brands across the U.S. to deliver top-tier talent.

Jenn’s professional journey began as a District Manager for a Top 10 Global Retailer, where she successfully led operations teams for five years. She later transitioned into sales leadership roles before finding her true calling in recruiting. It didn’t take long for Jenn to realize she had discovered her zone of genius.

In 2017, Jenn founded J Recruiting Services to serve the industry she knows and loves—retail. A self-proclaimed “retail nerd,” she created the firm to deliver tailored recruiting solutions that align with her clients’ unique needs. Today, as CEO, Jenn leads her team in placing top talent in roles across store operations, warehouse leadership, and executive positions for major retail brands across the nation. Her team’s mission is clear: deliver exceptional results that encourage both clients and candidates to expect more from external recruiters. They’re more than just recruiters—they’re true partners

Recognized as a Top Woman in Grocery by Progressive Grocer and featured in Yahoo Finance, Jenn is passionate about giving back. She is a member of NextUp, an organization advancing women in business, and mentors veterans transitioning to corporate careers through American Corporate Partners (ACP). Jenn’s commitment to empowering others and connecting great people to great opportunities is at the heart of everything she does.

https://www.linkedin.com/in/jenn-hahn-5698b66a/

https://www.linkedin.com/company/jrecruitingservices/

https://jrecruitingservices.com/

https://www.facebook.com/JRecruitingServices/