Wal-Mart Plans to Cut Over 1,000 Corporate Jobs -- Update
January 12 2018 - 6:21PM
Dow Jones News
By Sarah Nassauer
A day after promising to give its store workers raises and
bonuses, Wal-Mart Stores Inc. is preparing to hand out pink slips
at its headquarters.
The giant retailer, which is based in Bentonville, Ark., and
employs more than 1.5 million people in the U.S., plans to cut more
than 1,000 corporate jobs, according to people familiar with the
matter.
The job cuts are expected to be broad based, focused on workers
primarily at the company's headquarters, the people said. The cuts
are expected to be completed by the end of the company's fiscal
year on Jan. 31, they added.
"We've been looking at our structure for some time as we explore
ways to operate more effectively," a Wal-Mart spokesman said,
without confirming that job cuts are planned this month.
The expected corporate job cuts add to around 10,000 store jobs
being eliminated this month as Wal-Mart closes 63 Sam's Club
locations, about 10% of the warehouse club's U.S. stores. The
company disclosed the Sam's Club closings on Thursday, the same day
it said would raise starting wages for U.S. store workers, hand out
one-time bonuses and enhance paternity benefits.
The retailer has been cutting costs and pruning stores as it
frees up money to invest in an e-commerce push to fend off
Amazon.com Inc. It closed 154 U.S. Wal-Mart stores in 2016 and has
since slowed openings, while buying a series of online retailers
including Jet.com.
Wal-Mart is also reviewing the structure of its store
management, adding more assistant managers that will focus on new
activities happening in stores like online order pickup, while
eliminating other manager positions, said one of the people
familiar with the plans.
The retailer is adjusting an existing position called co-manager
to be more clearly a steppingstone to become a store manager, said
this person. Some of the co-managers whose jobs are eliminated will
move into the new assistant manager positions or other roles, said
this person.
"Retail is changing rapidly and we are transforming to meet the
needs of our customers," said Wal-Mart spokesman Blake Jackson. "To
help compete and win in this environment, we must make changes
across our company to enable further investments in our strategic
business priorities and growth."
In recent years Wal-Mart has shifted how it allocates other
store management positions, for example adding more department
managers to keep shelves consistently stocked and improve customer
service.
On Thursday, Chief Executive Doug McMillon said the wage
increases and bonuses were the retailer's response to a U.S. tax
overhaul that will decrease the corporate tax rate to 21% from 35%.
But analysts said the cost of the moves were just a slice of the
company's expected tax benefit and the retailer was also reacting
to competition for low-skilled hourly workers.
Under Mr. McMillon Wal-Mart has had several rounds of job cuts,
including about 7,000 back office store jobs in 2015, about 16,000
positions from store closures in 2016 and over 1,000 corporate jobs
early last year.
It has also added thousands of positions to stores including
workers who collect items for online pickup orders, said a
spokesman. Around two-thirds of the workers whose jobs were cut
during the 2016 store closures remained with the company, he
said.
The company employs more than two million people world-wide.
Write to Sarah Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
January 12, 2018 18:06 ET (23:06 GMT)
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