Macy?s to cut 4500 jobs

These job cuts and associated employee relocations are prompted by the closure of 40 stores that will be completed by early spring. It said slumping holiday season sales hurt its bottom line.

Macy’s will cut up to 4,800 at various store locations due to poor holiday sales. The company expects that about half of the affected store associates will be “placed in other positions”. The upper management will also take a hit, with Macy’s implementing a “voluntary separation opportunity” for about 165 senior executives.

Macy’s in the final three quarters of 2015 shuttered four locations that employed more than 450 people.

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. “Although we have much work to do, our strengthened omnichannel capabilities enabled our supply chain network to process millions of jcp.com orders this season, supported by 250 stores across the country that helped fulfill online orders using in-store inventory”.

The company expects a 2.7% drop in same-store sales for the year to January, more than the up to a 2.2% decline it had initially forecast.

Reducing 600 back-office positions, with about 150 being reassigned to other positions.

J.C. Penney reported Thursday a 3.9 percent sales increase during the holiday season despite the big impact that warm weather had on apparel sales. It also saw record online sales. Lehigh Valley Mall officials confirmed its Macy’s, one of three anchor tenants there, will remain open. (A complete list can be found here.) More than 1,500 store employees are expected to lose their jobs.

The Cincinnati company has blamed its woes on a shift in consumer spending, with Americans dishing out more money on nights out or vacations, and less on clothes. “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 to the marketplace”.

Macy’s also lowered its earnings guidance for the fourth quarter to $2.18 to $2.23 a share from previous guidance of $2.54 to $2.64 a share.

Macy’s shares closed down 2% at $36.14, but rose 2.8% in after-hours trading on the new expense reductions.