Macy’s To Cut Thousands of Jobs; Cites Disappointing 2015

Macy’s Inc. (NYSE: M) had a tough run over the holiday season and the company suffered, but no one thought that it might be this bad.

The American department store began as a captivating innovation in brick-and-mortar retail, then shifted to become the anchors of suburban malls.

The chain’s same-store sales- a key benchmark for retailers – fell 4.7 percent in November and December, reflecting a dismal holiday season for department stores.

About 3,000 jobs will be cut in each of Macy’s and Bloomingdale’s 770 stores from an average workforce of about 150 people in each store.

Macy’s has two stores in the Capital Region – at Crossgates Mall in Albany and at Colonie Center – but neither is scheduled to close, according to a list released by Macy’s. It now operates about 900 stores under its various Macy’s, Bloomingdale’s and Bluemercury nameplates.

In a bid to better compete with discounters and fast fashion brands, Macy’s said it would open about 50 off-price locations under the Macy’s Backstage banner, which it introduced previous year. The Danbury location will remain open.

Macy’s CEO Terry Lundgren was quoted by USA Today as saying that it had experienced a tough holiday season due to warm weather and lower spending among global tourists.

In November, Lundgren anticipated that the company would have a tough fourth quarter. Roughly 165 senior executives who meet certain age and service requirements will be offered a “voluntary separation opportunity”.

The country’s largest department store chain announced that the company will be closing 40 stores in the USA and will be cutting up to 4,800 jobs, The Associated Press reported.

These moves are part of an ongoing campaign by Macy’s to be able to compete in the retail world where the more demanding shoppers are going between stores and their mobile electronic devices. “But our eye is on a long-term vision of Macy’s Inc.as a dynamic retailer that serves existing customers and acquires new ones through innovative approaches”. In total, more than 2,100 employees are being laid off, apart from those expected to be reassigned.

The company warned investors that it expects its profit for its fiscal fourth quarter and full year to fall short of the expected estimates.