As Black Friday and the official start of the holiday shopping season stand pressed against the gates ready to burst forth, countless retailers may be saddled with a different, unforeseen concern: employee theft now makes up more retail loss in America than shoplifting, according to a new report.
The Global Retail Theft Barometer, a survey conducted by loss prevention firm Checkpoint Systems, has concluded that employees account for 43% of lost revenue, while traditional shoplifters account for 37%. This trend is unique to America (and Argentina, whose numbers are even higher), with the rest of the world’s workers only contributing to 28% of shrinkage.
Retail loss is a serious issue that faces nearly every industry, amounting to a loss of $128.5 billion globally every year. Worldwide, employee theft and shoplifting account for 65% of that total number. Other contributing factors include vendor or supplier theft and administrative and non-crime losses.
Some experts claim that America is rife with employee theft because factors like low, stagnant wages and wage theft breed negative feelings by an employee towards their employers. A 2014 report by the Economic Policy Institute claims that wage theft amounts to more than $50 billion annually.
While raising wages across the board can be extremely costly, especially for large, multinational companies, loss-prevention experts have offered a number of possible ways to reduce employee theft.
Hidden cameras, GPS trackers, and professional investigators are all used by companies to control retail loss. Hidden cameras are used to cover blind spots in a store’s security system, while GPS trackers follow shipments and individual large ticket items to prevent theft. Professional investigators work in a similar way to secret shoppers, except instead of looking to assure quality customer service, they attempt to curb shoplifting.
While the statistics support a minor epidemic in employee theft, with a measured approach, a raise in wages, or a combination of the two, we could see a decline in these numbers, especially as the American economy continues to strengthen.
Watch a video of some of the study’s finding’s below:
Image by Gustavo Serrano, licensed under Creative Commons