Marxism and the crisis in retail
By Mattie Stardust
“If you want to know about American history, just page through a Sears catalog!”
These words, no doubt meticulously crafted by a multi-million-dollar marketing firm, call to mind the Sears-Roebuck of the twentieth century. Once a fledgling mail order catalog, by mid-century Sears would become the largest department store chain in the U.S., boasting the tallest skyscraper in the world. Sears exuded luxury and upward mobility through consumerism, and as such it came to represent the very embodiment of U.S. American monopoly capitalism in all its splendor.
But it is in the 21st century, in the midst of Sears’ scramble to stave of impending bankruptcy in the wake of the ruinous 2008-2009 financial crisis, that this catchphrase earns its true significance. If the Sears catalog of the twentieth century indeed offers a vignette of U.S. imperialist ascendancy, it is the Sears reality of today that presages the prospects for a broader U.S. imperialist decline.
In a July 7 blog post Sears CEO Eddie Lampert announced continued store closures for the beleaguered retailer:
“Today, we will initiate the closing of an additional eight Sears and 35 Kmart unprofitable stores as we continue to focus on our best stores and return to profitability. This is part of a strategy both to address losses from unprofitable stores and to reduce the square footage of other stores because many of them are simply too big for our current needs.”
Sears had already shared plans to shutter some 265 stores earlier this year, and to lay off of at least 400 employees. In stores not yet closed, Business Insider reports widespread dilapidation, including empty shelves, leaky ceilings and rodent infestations.
Unable to keep pace with an increasingly globalized and technologized economy, Sears finds itself being steadily edged out by the likes of Walmart’s automated distribution systems and Amazon’s ability to undercut brick-and-mortar prices online. The company that in 1971 built the then-tallest skyscraper in the world to house its Chicago area employees and executives, can no longer generate sufficient profit even to keep its stores open.
This dynamic is by no means isolated to Sears. Brick-and-mortar retailers across the country are facing the biggest crisis to befall the industry in decades. Children’s clothing brand Gymboree plans to close some 375 to 450 stores in the U.S., laying off as many as one-third of its 11,000 employees. Downsizing at Macy’s will result in some 10,000 layoffs. And even retail giant Walmart has eliminated some 18,000 jobs since last year.
Meanwhile, earlier this year, online retail giant Amazon announced plans to hire some 100,000 workers for its distribution warehouses across the country. Practically awash in liquid assets and investor confidence after it’s twentieth straight year of double-digit revenue growth, Amazon also recently acquired retail food store chain Whole Foods for $13.7 billion.
Amazon, automation and the organic composition of capital
For the potentially millions of brick-and-mortar retail workers at risk of being edged out of a job in the next decade, Amazon’s growth offers little solace. Indeed, the essence of Amazon’s competitive edge against Sears and the brick-and-mortar retail dynasty is in its ability to automate its operations, thereby reducing the overall number of workers needed to turn a profit, while at the same time more intensively exploiting those that remain employed.
CNN tech reports, “Amazon’s addition of robots in 2014 allowed it to store 50% more inventory, according to the company.”
“Amazon employees, called pickers, used to have to walk up and down long aisles of goods to find each item on a shelf. With its Kiva robots, these pickers now stand in place, meaning they can pick more goods per shift.” [emphasis added]
“[Now,] on a typical Amazon order, employees will spend about a minute total — taking an item off the shelf, then boxing and shipping it.”
The effects of this trend towards automation at the expense of human labor, what Marxists refer to as a rising organic composition of capital, will most certainly be felt far beyond the retail workers most directly affected.
For one, by sloughing off large numbers of retail workers, employers exert a general downward pressure on wages across industries.
And for workers at Amazon and other high-tech workplaces, the simplification of the labor process offered by automation enables employers to further depress wages, switching from skilled and semi-skilled to unskilled labor.
In short, the ability of Sears to regain its market share and profitability depends on the extent to which it can innovate to reduce labor costs, hike productivity and more intensively exploit its remaining workforce. In a word, the brunt of the effects of the retail crisis must be shifted more fully onto the shoulders of workers for Sears to weather this storm. Such is the cruelty of the capitalist system.
As above, so below
It was a youthful, productive and still historically progressive capitalist imperialism under which Sears was able to construct its gilded retail empire. Similarly, Sears’ present hardship takes place in the context of a moribund imperialist system, no longer productive or historically progressive, and scarcely able to provide a even a subsistence living for the global working class. In a frenzy to recover from diminishing rates of profit, the U.S. ruling class has turned to austerity budgeting, rolling back financial regulations, and the most naked colonial violence. U.S. imperialism is more than eager to shift the burden of the capitalist crises onto the global masses.
Once considered the “land of opportunity,” for many workers in the U.S. today, the only “opportunities” that can be found in abundance are incarceration, drug addiction, police brutality and occupation, or unemployment and underemployment.
If there is any hope to be found, both for Sears workers and generally for the masses of people exploited or oppressed by U.S. imperialism, it is that the objective processes that are now wreaking havoc the world over are the very same processes which inevitably, unswervingly are creating the conditions for the final burial of imperialism by its gravediggers, the global working class.