What the Growth of Big Business Means for Jobs
The number of workers large companies typically employ in a single place has fallen.
What the Growth of Big Business Means for JobsCBR Briefing #56
- April 02, 2018
- CBR - Economics
How Costco, not Amazon, is responsible for the death of your local Sears
Warehouse clubs and superstores have made a bigger impact than e-commerce on the retail sector
While e-commerce saw a tenfold rise in sales, warehouse clubs and superstores grew even faster.
- E-commerce is less threatening to walk-in stores—particularly department stores—than very large brick-and-mortar operations such as Walmart Supercenter and Costco, according to a study by Ali Hortaçsu of the University of Chicago and Chicago Booth’s Chad Syverson.
- While e-commerce saw a tenfold rise in sales in the United States, warehouse clubs and superstores grew even faster, the researchers find (see chart). For example, Amazon added $38 billion in sales between 2000 and 2013, while Costco added $50 billion in sales during the same period.
- The researchers also analyzed US county-level data from 2003 to 2013. Counties with larger increases in the number of warehouse clubs and superstores had larger declines in the number of traditional department stores.
- E-commerce will likely continue to gain in importance, but the researchers suggest that the strength of very large physical stores could lead to a hybrid format in which customers can explore potential purchases in a brick-andmortar setting before purchasing online.
Ali Hortaçsu and Chad Syverson, “The Ongoing Evolution of US Retail: A Format Tug-of-War,” Journal of Economic Perspectives, Fall 2015.
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