Kroger-Albertsons merger could upend 164,000 industry workers

Southern California’s supermarket sector got a big jolt Friday when Kroger announced a proposed merger with Albertsons, putting a spotlight on a slice of local retailing that’s fared well in the pandemic era.

The deal to pair up several of Kroger’s local chains (Ralphs and Food4Less) with Albertsons’ name-sake stores plus Vons and Pavillions will draw intense regulatory scrutiny. Would such a giant chain cut consumers’ food shopping options?

And what of the employees? The companies have said they’ll sell as many as 375 stores through a spinoff.

Consider that a merger of this magnitude could reshape the food-and-beverage-store industry in Los Angeles, Orange, Riverside and San Bernardino counties, which employed 163,600 people as of August.

My trusty spreadsheet, filled with state job figures, found that jobs at grocery stores were at 105% of pre-pandemic employment in August 2019. The sector, which includes supermarkets, beverage stores and small grocery shops, saw a gain of 7,600 jobs in 12 months, or 4.9% growth. That hiring spree is nearly five times the 0.8% yearly pace since 1990.

FILE – Mitch Maddox, a bread route salesman, loads bread Tuesday, May 30, 2006, outside the Eagle Rock Albertsons store in Los Angeles. Two of the nation’s largest grocers have agreed to merge in a deal that would help them better compete with Walmart, Amazon and other major companies that have stepped into the grocery business. Kroger on Friday, Oct. 14, 2022 bid $20 billion for Albertsons Companies Inc., or $34.10 per share. (AP Photo/Damian Dovarganes, File)

Consider food stores’ hot job performance vs. the rest of retailing during the pandemic. Employment has been stagnant at shopping centers without groceries have suffered.

The number of Southern California retail jobs — minus food stores — was 581,300 workers in August — still 99% of pre-pandemic staffing, or 5,400 employees short. That’s after growing by 15,900 in a year for 2.8% growth vs. a 0.4% yearly hiring pace since 1990.

Compare that job performance to other key Southern California employment niches: transportation/warehousing (123%), healthcare and social services (105%), business services: (103%), real estate/finance (100%), food services & drinking places (98%), manufacturing: (96%), arts, entertainment & recreation (92%), and accommodations (81%).

Let’s break down the food store industry, geographically speaking.

In Los Angeles County …

Food stores: 96,300 workers in August, 105% of August 2019 after growing by 4,900 in a year —  5.4% growth.

Retail minus food stores: 321,200 jobs, 100% of pre-pandemic level after growing by 11,700 in a year —  3.8% growth.

In Orange County …

Food stores: 30,000 workers in August, 101% of pre-pandemic level after growing by 900 in a year —  3.1% growth.

Retail minus food stores: 114,100 jobs, 95% of August 2019 after declining by 200 in a year —  a 0.2% decline.

And in the Inland Empire …

Food stores: 37,300 workers in August, 111% of August 2019 after growing by 1,800 in a year —  5.1% growth.

Retail minus food stores: 146,000 jobs, 101% of pre-pandemic level after after growing by 4,400 in a year —  3.1% growth.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com