Macy's to cut nearly 4,000 corporate jobs, citing COVID-19 hit
Macy's said Thursday it's laying off 3,900 corporate staffers, roughly 3% of its overall workforce, as the pandemic takes a financial toll on the famed department store chain.
The company said in a press release the headcount reduction will save $630 million per year.
Like many of its retail peers deemed non-essential during the early waves of shutdowns, Macy's was forced to close its stores to curb the spread of the coronavirus, evaporating sales. The New York-based company also furloughed a majority of its workers.
Since early May, Macy's has been gradually reopening its 550-plus stores, which had been closed since March 18. Macy's CEO Jeff Gennette has said that customers are coming back, but it needs to cut costs to readjust its business to a new climate.
Earlier this month, Macy's Inc. reported sales of $3 billion for the three-month period ended May 2, down 45% from the $5.5 billion it saw in the year-earlier period.
The company is also estimating a quarterly net loss of $652 million, or $2.10 per share, for the first fiscal quarter. That compares with net earnings of $136 million, or 44 cents per share, in the year-ago period. Macy's reports final results July 1.
While the re-opening of our stores is going well, we do anticipate a gradual recovery of business, and we are taking action to align our cost base with our anticipated lower sales," Gennette said in a statement.
Macy's had been struggling long before the pandemic with competition from lower-priced retailers like Walmart, T.J. Maxx and Target, as well as the advent of online shopping. Macy's in February announced it would close 125 of its lowest-performing stores, and slash roughly 2,000 jobs at its offices in Cincinnati and San Francisco.