Sluggish sales this Christmas season is prompting one of the nation’s most well known department stores to make cuts. Correspondent Steve Kastenbaum says Macy’s will be handing out thousands of pink slips to employees soon. Correspondent Steve Kastenbaum reports Macy’s hopes to save about $400-million to help offset its “disappointing” 2015 results. The struggles are forcing Macy’s to close stores: on Wednesday, the company listed 36 stores slated to close early this spring, including ones in Los Angeles, Buffalo and Fort Worth. The iconic department store announced plans on Wednesday to lay off about 4,350 employees across the country. Macy’s said about 3,000 sales associates will be impacted, or about three to four per Macy’s and Bloomingdale’s location. The company expects that about half of the affected store associates will be “placed in other positions.” Some workers will be reassigned to other jobs. Macy’s is also implementing a “voluntary separation opportunity” for about 165 senior executives.
The company said sales in the critical November and December period slumped by a worse-than-expected 5%. Profits are also expected to miss the company’s own targets. Like other retailers, Macy’s blamed the “historically warm weather” in northern climates. Macy’s said about 80% of its sales declines can be attributed to shortfalls in cold-weather goods like coats, sweaters, hats, gloves and scarves. Macy’s also pointed to the impact of the strong U.S. dollar, which has caused international tourists to spend less. Macy’s expects the cost-cutting moves to hurt fourth-quarter profits by $200 million. Still, Wall Street cheered the belt tightening, bidding Macy’s shares up nearly 6% in after-hours trading on Wednesday. The stock lost nearly half its value in 2015, making it one of the worst performers in the S&P 500.