Macy’s Temporarily Lays Off Almost 130,000 Employees Without Pay and Delays Bonuses
Macy’s said it furloughing the “majority” of its employees because the coronavirus pandemic has taken a “heavy toll” on its business. Nearly 130,000 employees would be temporarily let go, without pay, although employees will continue to receive health benefits through May.
In a press release, Macy’s said, “all of our stores have been closed since March 18th and will remain closed until we have clear line of sight on when it is safe to reopen.”
Although the online business is open, the company said it has lost the majority of its sales because of the store closure. “We’ve already taken measures to maintain financial flexibility, including suspending the dividend, drawing down our line of credit, freezing both hiring and spending, stopping capital spend, reducing receipts, canceling some orders and extending payment terms, and we are evaluating all other financing options.”
Macy’s did specify that “while these actions have helped, it is not enough.”
Across Macy’s, Bloomingdales, and Bluemercury brands, Macy’s will move to the absolute minimum workforce needed to maintain basic operations. In the same press release, they specified that, “this means the majority of our colleagues will go on furlough beginning this week.”
Macy’s Was Struggling Before The Coronavirus Pandemic
Like most major retailers, Macy’s was struggling even before the coronavirus pandemic shit down the entire country. In February, Macy’s had announced plans to close about 125 stores over 3 years.
Macy’s had said in a statement that it is also cutting 2,000 jobs — about 9% of its corporate workforce — and shuttering offices in Cincinnati and San Francisco to consolidate operations at its New York headquarters.
Bonuses Are Delayed and Temporary Cuts Will Come In Effect
Jeff Gennette, Macy’s chairman and CEO, is foregoing pay until the crisis subsides. Macy’s had also has delayed bonuses and 401(k) matches executives will take temporary pay cuts beginning in April.
Although Macy’s did say that, “we expect to bring colleagues back on a staggered basis as business resumes.”
3.38 Million People have filed For Unemployment
3.28 million Americans filed for unemployment benefits as the coronavirus pandemic shut down the entire country. The Labor Department’s report for the week ending on March 21 was one of the first official indicators of how many people were suddenly out of work.
“This marks the highest level of seasonally adjusted initial claims in the history of the seasonally adjusted series,” the department said of the latest figure. “The previous high was 695,000 in October of 1982.”