Macy's laying off more than 2,000 employees, closing 5 stores

Macy's said the difficult decision represents "a new strategy to meet the needs of an everchanging consumer and marketplace.”

NEW YORK (AP) — Retail layoffs are hitting especially hard this week. Macy’s is laying off about 3.5% of its total headcount, which amounts to roughly 2,350 employees, and the iconic department store is closing five locations.

Macy's confirmed layoffs to The Associated Press via email—with the New York company saying it made the difficult decision as it prepares "to deploy a new strategy to meet the needs of an everchanging consumer and marketplace.” The five stores to be closed are in Virginia, California, Hawaii, and Florida, according to a spokesperson for Macy's Inc.

The Wall Street Journal first reported on Macy's layoffs and planned store closures Thursday, citing an internal memo and people familiar with the situation. The layoffs will occur on Jan. 26, according to the outlet.

Macy’s made significant job cuts in the pandemic’s early days—including the layoffs of 3,900 corporate staffers as COVID took a toll on sales in June 2020. And in February 2020, just weeks before the virus was declared a pandemic, the company announced 2,000 job cuts in its corporate office and the closure of 125 stores.

Online furniture seller Wayfair is also cutting about 1,650 jobs, or 13% of its global workforce. Wayfair announced its latest job cuts Friday. The restructuring will reduce team sizes across the company and reduce seniority in certain roles with the company planning to “rebuild with modified leveling” this year, CEO and co-founder Niraj Shah said.

“The natural question is to ask ‘Why?’” he wrote in a Friday memo to employees. “I think the reality is that we went overboard in hiring during a strong economic period and veered away from our core principles, and while we have come quite far back to them, we are not quite there.”

In January of last year, Wayfair laid off about 1,750 employees—representing 10% of its global workforce at the time. It cut 870 jobs in August 2022, and 550 jobs in 2020. Friday’s job cuts are expected to bring annualized cost savings of more than $280 million, Wayfair said. The company anticipates incurring about $70 million to $80 million in restructuring costs, mostly for employee severance and benefits, primarily in the first quarter of 2024.

Job cuts have taken a toll on workers across various industries—including retail, tech, media and hospitality—over the last few years. In recent months, layoffs have been announced at Google, Amazon, Hasbro, LinkedIn and more. Macy’s stock fell about 3% Friday. Wayfair shares rose more than 7%.