Electronic shelf labels could cost jobs, raise grocery prices, report says

Key facts

• A report by the AFL-CIO Tech Institute suggests widespread adoption of electronic shelf labels could cost tens of thousands of jobs and billions in lost wages.
• The analysis indicates ESLs could further drive up grocery prices due to their connection with algorithmic pricing software.
• Manufacturers promote ESLs for cost-cutting, data collection, and profit enhancement.
• The report calls for a ban on electronic shelf labels to protect consumers and workers.
• Maryland, Connecticut, and New Jersey have already passed legislation banning surveillance pricing and electronic shelf labels.

A report released by the AFL-CIO Tech Institute warns that the widespread implementation of electronic shelf labels (ESLs) in U.S. grocery stores could lead to significant job losses and increased consumer costs. The analysis suggests that universal adoption of these labels could cost workers between $1.6 billion and $6.9 billion in lost wages annually, affecting between 44,223 and 191,633 jobs.

The report, titled "Priced Out, Pushed Out: Electronic Shelf Labels Raise Prices and Shrink Paychecks," advocates for a ban on ESLs, citing concerns for both consumers and workers. Manufacturers have promoted ESLs as a means to collect customer data, boost profits, and reduce labor costs. However, the report argues that ESLs utilize the same dynamic pricing systems found in online retail, which could exacerbate rising grocery prices. Sunny Glottmann, a co-author of the report, stated that ESLs create the infrastructure for rapid algorithmic price changes, potentially increasing costs for consumers already struggling with food expenses.

This development comes at a time when food prices have outpaced inflation and wage gains, increasing by 33% over the past seven years. Several states have already begun introducing legislation to ban surveillance pricing and ESLs, with Maryland, Connecticut, and New Jersey enacting such bans. Lauren McFerran, executive director of the AFL-CIO Tech Institute, described ESLs as a technology enabling both maximum extraction of money from shoppers and squeezing of workers.

A poll by the United Food and Commercial Workers union found that a majority of Americans believe surveillance pricing and digital price tags will increase grocery costs and support a ban on these technologies. Ademola Oyefeso, vice-president of UFCW International, explained that labor cuts associated with ESLs are gradual, impacting shelf stockers and leading to reduced work hours. He contrasted this with the traditional use of paper labels, which ensured consistent pricing for all customers.