With 3,900 fewer checks to sign, Macy's says it'll save almost $630 million this year.
Macy's Inc said on Thursday it would lay off about 3,900 employees in corporate and management positions as USA businesses try to save cash in the face of dwindling demand caused by the COVID-19 pandemic.
Macy's Inc. had around 123,000 employees at the end of January. Additionally, Macy's said it has reduced staffing across its store portfolio, supply chain and customer support network, which it will adjust as sales recover. As many as 25,000 bricks-and-mortar stores are expected to permanently close this year, according to Coresight Research, which will have far-reaching effects on shopping malls, workers and local communities. All of Macy's stores were shut down to slow the spread of the virus on March 18, and they slowly started resuming on May 4.
Macy's is reopening its stores but that's not stopping the layoffs. The company comprises three retail brands, Macy's, Bloomingdale's and Bluemercury.
Police vehicles park outside Macy's flagship Herald Square store in NY city after it was broken into on June 1, 2020.
"COVID-19 has significantly impacted our business", said Jeff Gennette, chairman and CEO of Macy's Inc., in a statement. I want to thank all of our colleagues - those who have been active and those on furlough - for helping us get through this hard time, and I want to express my deep gratitude to the colleagues who are departing for their service and contributions.
The company, which reopened its flagship Manhattan store on Monday, said it would bring back most of its remaining furloughed employees in the first week of July.
"We know that we will be a smaller sized enterprise for the foreseeable potential, and our price tag base will carry on to replicate that going ahead", Gennette claimed. He said the company's lower cost base would combine with approximately $4.5 billion in new financing to increase company stability and flexibility.
Macy's stock was trading at $6.44 per share at 11:39 a.m. EDT, down $0.34 from 4.94%.