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Macy's announces 7,000 job cuts | Macy's announces 7,000 job cuts |
(about 2 hours later) | |
US department store chain Macy's is cutting 7,000 jobs as it reduces costs against a backdrop of falling sales. | US department store chain Macy's is cutting 7,000 jobs as it reduces costs against a backdrop of falling sales. |
Sending shares in the firm down 11%, Macy's said the redundancies would affect both store and office positions. | Sending shares in the firm down 11%, Macy's said the redundancies would affect both store and office positions. |
With a current workforce of about 180,000 people, the cuts represent about 4% of its staffing levels. | With a current workforce of about 180,000 people, the cuts represent about 4% of its staffing levels. |
Macy's said it hoped the move would allow it to make an annual saving of $400m (£281m). It added that it will likely report a fall in annual sales. | Macy's said it hoped the move would allow it to make an annual saving of $400m (£281m). It added that it will likely report a fall in annual sales. |
'Tough 2009' | 'Tough 2009' |
It predicts that annual same-store sales - which excludes new shop openings - will be between 6 and 8% lower. | It predicts that annual same-store sales - which excludes new shop openings - will be between 6 and 8% lower. |
They have not been competing on a value proposition and this is a value market Patricia Edwards, retail analyst with Storehouse Partners | |
The firm said tough trading conditions would continue throughout 2009. | The firm said tough trading conditions would continue throughout 2009. |
Macy's has 810 stores across the US. | Macy's has 810 stores across the US. |
US consumer spending fell for a sixth consecutive month in December, according to the latest data released by the Commerce Department on Monday. | US consumer spending fell for a sixth consecutive month in December, according to the latest data released by the Commerce Department on Monday. |
Analysts said Macy's would have to start cutting prices to win more customers. | |
"The retail environment has changed so much," said Patricia Edwards, a retail analyst with Storehouse Partners. | |
"They have not been competing on a value proposition and this is a value market." |
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