Target, Walmart Join the Flurry of Layoffs
Last week, JCPenney and Macy's reported layoffs and store closings that would save the retailers millions. This week, several more retailers followed suit announcing a flurry of layoffs, including Target, Sprint, Walmart Sam's Club and more.
Typically speaking, because it follows the hectic holiday season, January is a busy month for retailers to announce store closings. But this year's closings are indicative of a new trend, triggered by more and more shoppers turning to e-commerce.
At the NRF Big Show in early January, founder and CEO of Caruso Affiliated, Rick Caruso said that without a major reinvention, traditional malls will soon go extinct, noting that he is unaware of an indoor mall that has been built since 2006. "Any time you stop building a product, that's usually the best indication that the customer doesn't want it anymore," he said.
Following JCP's reduction of 2,000 jobs and Macy's reduction of 2,500, Walmart Sam's Club adds 2,300 to the roster. "We realized we had pretty much the same club structure whether a club had $50 million in revenue or $100 million in revenue," said Bill Durling, a spokesman for Sam's Club, of the distribution of assistant managers. "What we're trying to do is balance our resources."
Embroiled in a data breach that placed well over 100 million customers data at risk, Target has announced that it will shutter 1,175 jobs, including 475 layoffs and some 700 positions that will not be filled. During this difficult time the retailer will offer affected workers at least 45 days severance, though longer-tenured workers may get more, according to Target spokeswoman Molly Snyder.
"Retailing is in a transformative time,'' noted Snyder. "We're making decisions that will help us thrive and grow in the future.''
Sprint retail stores are also joining the flurry, letting go of 300-500 employees. Additional job cuts will occur in Sprint's customer care centers, business sales and other areas, though the number of those layoffs has not been determined, according to reports. The layoffs will affect both management and non-management employees.
But layoffs aren't the only movement that are being seen this month, a series of retailers have also reported store closings. Sears said that it will shutter its flagship store in downtown Chicago in April. It's the latest of about 300 store closures in the U.S. that it has made since 2010. American Eagle will decrease its number of Aerie locations, moving some of its locations back into its main stores, and Aéropostale will close 175 stores over the next few years.