Macy's will lay off 2,350 employees amid sagging sales, representing 3.5% of its workforce, the company confirmed to Scripps News on Friday.
"As we prepare to deploy a new strategy to meet the needs of an everchanging consumer and marketplace, we made the difficult decision to reduce our workforce by 3.5% to become a more streamlined company," the company said in a statement.
Macy's said the following five stores will close as part of its decision:
Ballston (Arlington, Virginia.), Bay Fair (San Leandro, California), Kukui Grove (Lihue, Hawaii), Simi Valley Town Center (Simi Valley, California), and Governor’s Square (Tallahassee, Florida).
There has been a cadence of Macy's store closures in recent years. The retailer closed four locations in January 2023.
But later in 2023, the company opened four small-format locations located in off-mall locations. That brought the total number of small-format locations owned by Macy's to 15. By the end of this year, the company expects to have 30 small-format locations, as many Americans have shied away from traditional indoor malls in recent years.
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The company's CEO said cutting employees will save $280 million in expenses as sales have plummeted in the last two years.
By 2025, the company expects to have 45 small-format locations throughout the U.S.
But sales for the venerable retailer have continued to decline. In its latest investor report in late 2023, the company had $4.3 billion in sales in the third quarter of 2023, a 7.1% drop from the same quarter in 2022.
In 2023, Macy's announced that company executive vice president Tony Spring would replace Jeff Gennette as CEO effective February 2024.
"I see tremendous opportunity to build upon the storied reputation of each of our nameplates. We are further strengthening relationships with our customers through compelling merchandise, partnering with the best brands, and delivering great shopping experiences,” Spring said in 2023.
