Macy’s plans to cut 2,350 jobs and close 5 stores

Macy’s plans to cut 2,350 jobs and close 5 stores

Macy’s, the nation’s largest department store operator, told employees Thursday that it will lay off 13 percent of the company’s workforce. This step comes as the company prepares to unveil a new strategy that will be supervised by its next CEO.

The cuts amount to approximately 2,350 jobs, or about 3.5% of the company’s total workforce, which includes employees at subsidiaries Bloomingdale’s and Bluemercury. The layoffs will be accomplished by eliminating some roles and consolidating teams, according to memos seen by The New York Times.

The company also said it would close five of Macy’s more than 560 stores.

The decisions were based on consumer research and were intended to make the retailer more competitive by improving its cost structure and driving faster decision-making, the memos said.

The Wall Street Journal had previously published these cuts.

Tony Spring will take over as CEO of Macy’s next month, succeeding Jeff Gennette, a veteran of the company who is retiring after holding the position since 2017. Mr. Spring, who ran Bloomingdale’s, was named to the top job in March and has led research efforts . Along with Adrian Mitchell, Macy’s CFO and COO.

The company said it will unveil its broader strategy in the near future.

“As we prepare to deploy a new strategy to meet ever-changing consumer and market needs, we have made the difficult decision to reduce our workforce by 3.5 percent to become a more streamlined company,” a Macy’s spokesperson said in an email. statement.

In a memo to employees, the company said it would “offshor certain areas of the business,” but did not provide details.

As consumers spent less on apparel and discretionary items over the past year, Macy’s struggled to increase its sales and was facing pressure to improve its business. In December, a group of investors made a bid to take the company private at $5.8 billion, more than $1 billion above its market value at the time.

The stock price has risen more than 50 percent over the past two months but is still lower than it was a year ago or at the beginning of the pandemic.

“Macy’s clearly needs to keep investors satisfied, and its focus on profit has achieved that at a time when sales performance has been extremely lackluster,” Neil Saunders, managing director of research and consulting firm GlobalData Retail, said Thursday by email. “However, this strategy comes with an expiration date; ultimately, no retailer can afford to scale themselves back to succeed.

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