Wal Mart Stores (NYSE:WMT)
Historical Stock Chart
1 Month : From Dec 2017 to Jan 2018
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 email@example.com
(END) Dow Jones Newswires
January 12, 2018 18:06 ET (23:06 GMT)
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