A UPS worker sorts packages in New York on Dec. 18th, 2017. Adam Jeffery | CNBC

U.S. retailers, from Amazon to J.C. Penney, have started earlier and are paying more and upping benefits in a pitched battle to hire more than 700,000 holiday workers in what is the tightest labor market in decades. The competition to fill all of those openings is fierce. Kohl's started hiring its holiday help in June, and Amazon shook up the entire job market when it announced plans to raise its minimum wage to $15 an hour for its 250,000 U.S. employees. J.C. Penney is holding raffles for pricey vacation packages and gift bundles worth $5,000 apiece. Help-wanted signs have dotted U.S. stores since the summer as retailers look to hire 704,000 holiday workers this year — the most since 2014, when unemployment was around 6 percent, compared with a nearly five-decade low of 3.7 percent in October, according to job placement and coaching firm Challenger, Gray & Christmas. "In July, when there is no business and no one needs additional help, every store I walked by had a help-wanted sign," said Jan Kniffen, CEO of J. Rogers Kniffen WWE and a CNBC contributor. Walmart, the nation's largest retailer and private employer, doesn't hire seasonal workers. It instead gives its year-round employees more hours during the holidays, a strategy executives said worked for them over the previous two holiday seasons. It's also using artificial intelligence on its loading docks and installing new mobile checkouts to speed customers in and out the door. "That is why Walmart is testing robots to check stockouts, robots to speed up truck unloading, while cutting the labor required by two-thirds. That is why every retailer is testing self-checkout in some form," Rogers said.

The early bird

Kohl's has hired thousands of seasonal employees since it started interviews in June and is months ahead of its usual holiday hiring, said spokeswoman Jen Johnson, adding that the company wants 90,000 seasonal employees. "We saw an 80 percent increase in total hires from July through early September," she said, adding that thousands of people applied for seasonal positions at fulfillment centers before the hiring events began and "most candidates have walked out of their interview with a job offer." J.C. Penney held a "national hiring day" event on Oct. 16. The department store chain needs 39,000 seasonal workers, and turnout "more than met our goal," spokesperson Kate Coultas told CNBC. It's trying some new things this year, extending a 25 percent employee discount to holiday workers and giving away vacations and other prize packages to attract talent. Macy's plans to hire 80,000 seasonal workers for this holiday season. Hourly wages vary by location and position, but generally pay between $9 and $15.45 an hour. All Macy's employees, including holiday hires, are eligible for the retailer's bonus program, which CEO Jeff Gennette said in September at the Code Conference is a key draw for potential candidates. Spokeswoman Blair Rosenberg said the retailer is "ahead of our hiring projections for this point in the season." The department store will continue its hiring through November.

Wages are up

Retailers are under pressure to raise wages as they compete against other industries for entry-level candidates. Even before Amazon announced it was raising its minimum pay, wages were rising in retail. The annual median base pay for a cashier jumped to $28,237 in October, a 5.4 percent jump over the previous year, according to online job site Glassdoor.com. Amazon says it will finish filling seasonal positions by early December at the latest, just in time for its busiest weeks of the year. Its new minimum wage of $15 an hour, which began Nov. 1 and averages out to $31,200 a year for permanent, full-time employees, gives it a leg up over other retailers. "When we posted the announcement, we received more than 70,000 applications in the first 48 hours. Additionally, more applications were received in the week after the announcement than in the entire month of August, and traffic to AmazonDelivers.Jobs was up 180 percent," spokeswoman Lindsay Campbell told CNBC. Target CEO Brian Cornell said the retailer is ahead of schedule on filling 120,000 temporary positions. "We have already had some of our great holiday hiring events. We are seeing a great response. And we think we are going to be in a terrific position to fill those jobs," Cornell told CNBC, declining to say how many people it's hired so far. The retailer recently held a three-day hiring event at its stores where it received more than 100,000 applications. Gap Inc. spokeswoman Annie Lee said it's hiring "slightly more associates this year versus last year, therefore our applications are up" at its Gap, Old Navy and Banana Republic stores, distribution and call centers. She said the company needs 65,000 holiday workers, declining to say how much it's paying or how many have been hired so far.

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