Department store chain Macy’s is cutting 2,350 jobs and closing five stores as it aims to streamline its operations, a company spokesperson said Thursday.
The layoffs make up 3.5% of the overall workforce across Macy’s. The company operated 722 store locations as of January 2023 and employed 94,570 full- and part-time employees, excluding seasonal hires.
The job cuts come as an investor group consisting of Arkhouse Management and Brigade Capital put pressure to take Macy’s private in a $5.8 billion offer, as Reuters reported in December.
Macy’s incoming CEO Tony Spring is also focused on cutting expenses on promotions to boost margins as the company recovers from an inventory glut in 2022.
A Macy’s spokesperson told Reuters the layoffs were part of a plan “to deploy a new strategy to meet the needs of an ever-changing consumer and marketplace.”
As the company evaluates the “right mix of on- and off-mall locations”, it intends to close five of its full-line locations this year, the spokesperson added.
CNBC reported two of the stores are in California, in Simi Valley and San Leandro. The other three are in Florida, Hawaii and Virginia.
The job cuts were first reported by the Wall Street Journal. Citing a memo sent to employees, the paper reported the layoffs would occur on Jan. 26.
In November, the retailer beat analysts’ estimates for quarterly profit on lower inventories and strong demand for beauty products.
Locally, the company last fall opened a downsized store at the Santee Trolley Square. Macy’s plans to add the smaller shops, about 20% the size of traditional stores, both in malls and elsewhere, while offering a selection of best-selling products.
Larger Macy’s stores in San Diego include two in Mission Valley, and those at Westfield UTC, Westfield North County, Plaza Bonita, Otay Ranch Town Center and Grossmont Center.
The retailer also has leased a sprawling distribution center in Lathrop, south of Stockton, according to reports.
– From staff and wire reports, with Reuters reporting by Savyata Mishra in Bengaluru and editing by Maju Samuel.