Macy’s said Thursday it will lay off 3,900 corporate employees, about 3 percent of its total workforce, as the pandemic financially affects the famous department store chain.
The company said in a press release that reducing the workforce will save $ 630 million a year.
Like many of her fellow retailers deemed non-essential during the first waves of closures, Macy’s was forced to close its stores to curb the spread of coronavirus, evaporating sales. The New York-based company also laid off most of its workers.
Since the beginning of May, Macy’s has been gradually reopening its more than 550 stores, which were closed since March 18. Macy’s CEO Jeff Gennette has said customers will return, but costs need to be reduced to readjust their business to a new climate.
Earlier this month, Macy’s Inc. reported $ 3 billion in sales for the three-month period ended May 2, 45% less than the $ 5.5 billion it saw in the previous year.
The company also estimates a quarterly net loss of $ 652 million, or $ 2.10 per share, for the first fiscal quarter. This compares to net income of $ 136 million, or 44 cents per share, over the past year. Macy’s reports the final results on July 1st.
Retail giant Macy’s announces massive cuts
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While the reopening of our stores is going well, we anticipate a gradual recovery in the business and are taking steps to align our cost base with our projected lower sales, ”Gennette said in a statement.
Macy’s had been struggling long before the pandemic with competition from lower-priced retailers such as Walmart, TJ Maxx and Target, as well as the arrival of online shopping. In February, Macy’s announced it would close 125 of its lowest-performing stores and reduce approximately 2,000 jobs at its Cincinnati and San Francisco offices.
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