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The struggling iconic American industry you're not thinking of is retail

Catherine Rampell on

An iconic American industry is struggling.

This sector has long been battered by forces beyond its control: globalization, automation, "disruptive" new competitors, changing tastes. Bankruptcies mount, and workplaces shutter around the country. Big, empty buildings, once bustling with young people, have been left to rot.

To add insult to injury, the industry is poised to get slaughtered by President Trump's escalating trade wars. But notwithstanding the U.S. trade representative's (USTR) public hearings on the subject that began Monday, hardly anyone seems to care.

The industry I'm referring to? Why, retail, of course.

Retail is larger than any of the sectors Trump usually dotes on, the ones he bestows with bailouts and subsidies and affectionate tweets. "Retail salesperson" is the single biggest occupation in the country. Total industry employment eclipses that of manufacturing by some 3 million jobs, according to the Bureau of Labor Statistics.

In fact, more people work in department stores alone than in the entire coal mining industry -- by a factor of 20.

 

Lately, retail has been suffering. From January through mid-June, U.S. companies announced plans to close some 7,000 brick-and-mortar stores, more closures than in all of 2018, according to Coresight Research. This despite the fact that the economy has posted strong growth and consumers have more money in their pockets thanks to the recent tax cuts.

Many dark or soon-to-darken storefronts are household names, such as Payless ShoeSource, Gap, J.C. Penney, Family Dollar. They have struggled to compete as customers spend more of their money online (and on other purchases, such as restaurant meals).

Malls were also vastly overbuilt, growing more than twice as fast as the U.S. population from 1970 to 2015. So even without Amazon and other e-commerce, a correction was probably coming eventually, if not necessarily the retail-pocalypse we see today. (Amazon's founder, Jeff Bezos, owns The Washington Post.)

There are lots of parallels with Trump's pet industries. Retail, for instance, is dominated by demographics at the heart of Trump's political base: financially insecure non-college-educated whites displaced by technological change.

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