New York - US department store Macy's said Wednesday it would
cut thousands of jobs and go ahead with 68 planned shop closures, as
the company announced a drop in sales in the last two months of 2016.
After a 2.1 per cent drop in sales in November and December, Macy's
Chairman and CEO Terry Lundgren said that the company's performance
"reflects the broader challenges facing much of the retail industry"
in a statement.
On the same day, the company announced that it plans to make a
"headcount reduction of approximately 6,200 employees" starting in
early 2017.
Macy's shares fell 10 per cent in post market trading following the
announcements.
The company said it would reduce layers of management and make
changes to the way stores are operated in order to lose staff.
In addition, 3 900 employees will be displaced by the closure of 68
stores, it said. The store closures are part of the approximately 100
closings announced in August 2016.
Those displaced by the closings "may be offered positions in nearby
stores where possible," the company said.
The announced actions are hoped to generate annual expense savings of
approximately 550 million dollars, beginning in 2017, which the
company plans to invest 250 million in its digital business.
The iconic department store, one of the largest retailers in the US,
was founded in 1858 in New York City and currently operates 730
stores across the country.