KR Kroger Co

By Heather Haddon 

Kroger Co. is hiring 11,000 workers to improve customer service and efficiency at its thousands of stores as competition among food retailers heats up.

Kroger said the new positions at its nearly 2,800 supermarkets will include 2,000 managers and represent a 2% increase to its workforce of about 450,000 full- and part-time employees. The hiring push is part of a three-year plan to focus on overhauling existing stores instead of building as many new ones as in past years.

The largest U.S. supermarket chain wants to put more workers in stores instead of its Cincinnati headquarters, a spokeswoman said. Last year Kroger gave voluntary buyouts to 1,300 white-collar workers to cut costs as sales slumped.

Tim Massa, Kroger's group vice president of human resources and labor relations, said the new hires include cashiers, produce clerks and workers for the company's online grocery-pickup operations. Some workers will also staff Kroger's new restaurants and prepared-food sections, which the grocer is expanding.

Kroger and other traditional grocery chains are facing tougher competition for shoppers. Amazon.com Inc.'s purchase of Whole Foods Market is prompting grocers to speed up digital investments. At the same time they are feeling pressure to keep prices low as European deep-discounters Aldi and Lidl expand in the U.S.

"The core issue in food retail remains the high degree of bottom-line uncertainty," analysts at Morgan Stanley wrote to investors recently.

Kroger's share price, which edged down Tuesday, is off by about 14% this year.

Food retailers are also competing for workers in the tightest U.S. labor market in nearly two decades. The unemployment rate held at 4.1% on Friday for the sixth straight month, a 17-year low. Job openings are at a record high.

The worker shortage is even more pronounced in the Midwest, which as of the middle of last year had lost a net 1.3 million residents since 2010, according to the Census Bureau. Slow population growth, the aging baby-boom generation and fewer immigrants than the rest of the country have crimped the region's labor pool. Midwestern states including Ohio, Indiana and Michigan are among those with the most Kroger stores.

Mr. Massa said Kroger's hiring push is spread across the country.

Kroger, Walmart, Target Corp. and other food retailers are investing savings from the federal tax law to boost worker pay and benefits. Kroger has said it would spend $500 million on compensation, including raising starting wages in some regions to $10 an hour.

--Shayndi Raice contributed to this article.

Write to Heather Haddon at heather.haddon@wsj.com

(END) Dow Jones Newswires

April 10, 2018 17:44 ET (21:44 GMT)

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