Employees also gain from weekend without sales tax
Massachusetts’ sales tax holiday takes place Saturday and Sunday, but Barbara Breaux has been busy for weeks.
The 57-year-old, who drives a forklift at the T.J. Maxx Distribution Center in Worcester , has been working extra hours on the weekends to make sure dishes, clothing, and furniture are ready to be delivered to thecompany’s stores across the region.
She said TJX Cos., whose brands include T.J. Maxx, Marshalls, and HomeGoods, offered warehouse employees extra shifts leading up to the holiday, and it hired temps to make sure shelves are well stocked.
“I feel good about it because I can make extra money,” said Breaux.
While the focus of the sales tax holiday has been on deals for shoppers, the event is also a boon to retail employees who are able to log more hours and earn more money in a sluggish economy. During this weekend, most products $2,500 and under will be exempt from the usual 6.25 percent sales tax. Because the holiday can yield crowds rivaling those of Black Friday and Saturdays during the holiday season, businesses beef up their staffs — in some cases double the number of employees they typically have working — to ensure customers are properly served.
Jon Hurst, president of the Retailers Association of Massachusetts, said some members of his group make 7 to 10 percent of their annual sales during tax-free weekend. The holiday also encourages consumers to shop locally instead of ordering on Amazon.com or driving to New Hampshire, where there is no sales tax.
“We believe that most of the sales we will get this weekend are tax-free sales we recover,” he said.
Even items largely exempted by the tax holiday — such as meals and clothing — get a bump in sales by the sheer number of people who are out and about, Hurst added.
On usual Saturdays at the Bernie & Phyl’s furniture store in Braintree, there are at most 12 or 13 employees working the floor; this Saturday, there will be about 25 people. The chain will also be matching the 6.25 percent reduction, for a total savings of 12.5 percent on all items to which the tax exemption applies.
“We thought [matching the reduction] would be a great way to not only take advantage of the tax savings, but to also reward our customers as well,” said store manager Peter Markunas.
Jewelry store Lux Bond & Green will have seven people on the floor on Saturday, compared with the usual four. The high-end jeweler will also be open on Sunday, a day it’s normally closed, to capture more sales.
“Saturday is much busier than Sunday, but it’s worth opening on Sunday,” manager Jack Winer said.
And since much of its jewelry exceeds the $2,500 limit, Winer said the company has stocked specific products under the $2,500 price point, such as Tag Heuer watches.
While retailers may see increased traffic and sales over the two days, economists say in the long term, the boost from tax-free weekend isn’t that big.
“You will see the holiday give a slight boost or a slight stimulation in terms of new retail sales,” said Mike Lynch, a regional economist at Lexington-based IHS Global Insight. “It has a way of affecting the timing of purchases that I guess you could say would have otherwise occurred anyway.”
What it does do, he said, is give people who can’t afford to buy things they need — like a new sofa or television — the opportunity to finally buy those things.
“Even though the Massachusetts economy has been doing better than other parts of the country, you still have consumers out there living paycheck to paycheck, sometimes worse,” he said. “This tax holiday will be enough to get them out there.”
And enough to put some extra money in workers’ wallets. Breaux, the TJX warehouse employee, isn’t working Saturday. Of course, she said, she’s considering shopping.