Just days after Wal-Mart Stores Inc (NYSE:WMT) made waves by announcing it was to offer companywide bonuses to employees—with some valued as high as $1,000—the company has since turned around and plans to implement a large round of job cuts. Wal-Mart’s co-manager layoffs are the company’s biggest move in the new year so far, cutting thousands of salaried co-manager jobs and replacing them with far fewer and weaker paying assistant store manager positions.
The large cuts are part of a Wal-Mart cost-cutting plan. Retail industry layoffs in 2018 have therefore gotten off to a rough start if Wal-Mart is anything to judge by; the company also announced that 63 Sam’s Club stores would be shuttered. As Wal-Mart restructures management as well as institutes mass closings of its other brand, thousands of workers will soon be looking for new employment. Hardly a promising start to the new year.
The Wal-Mart co-manager layoffs will see 3,500 such positions eliminated. About 1,700 assistant store manager positions will replace the lost jobs, but these positions carry weaker pay.
Wal-Mart layoffs in 2018 will reach well into the thousands when you factor in the reduction of co-managers, Sam’s Club closures, and an additional 1,000 corporate jobs that are to be cut by the end of January.
And perhaps the final coup-de-grace for Wal-Mart workers: The bonuses promised are not as lucrative as they first appeared to be. While the company is offering $1,000 in bonuses to its most senior employees (people who have been with the company for 20 years), newer workers will receive a smaller bonus. The total value of the bonuses handed out amount to a reported $400.0 million, which, split between Wal-Mart’s 2.1 million employees, works out to an average of $190.00 per employee.
The value of the bonus amounts to about two percent of the total value of the corporate tax cut the company received along with many others as part of the newly passed Republican tax plan.
Wal-Mart is also looking to raise its minimum wage from $10.00 to $11.00 per house.
“Retail is changing rapidly and we are transforming to meet the needs of our customers…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,” Wal-Mart said in a statement, as reported by ThinkProgress.
Wal-Mart to Eliminate Around 1,000 Corporate Jobs by End of January
The hits have come hard and fast for Wal-Mart employees so far in 2018. The company, aside from the Wal-Mart co-manager layoffs announcement, also announced cuts coming to its headquarters.
About 1,000 jobs will be eliminated as part of the most recent round of Wal-Mart corporate worker layoffs. The cuts are said to be part of the company’s efforts to reduce costs and increase efficiency. The job cuts are likely to be implemented by the end of the month, as January 31 is the last day of the company’s fiscal year.
Wal-Mart job cuts will primarily be at the headquarters in Bentonville, Arkansas.
The Arkansas layoffs have yet to be confirmed by the company.
“As we’ve previously stated, we’ve been looking at our structure for some time as we explore ways to operate more effectively,” Wal-Mart spokesman Randy Hargrove said in an emailed statement to Arkansas Online. “We continue to do that but are not going to comment on rumors and speculation.”
These cuts are not unprecedented, with the company having instituted corporate job cuts around the same time in the past.
Last January, for instance, Wal-Mart shed about 1,000 positions across multiple divisions. The job cuts included 511 workers cut in Bentonville.
“From time to time, you’ll see the company eliminate positions in an effort to stay lean and fast,” wrote CEO Doug McMillon in an internal memo at the time.
Wal-Mart Recently Announced Closure of 63 Sam’s Club Stores, Affecting Nearly 9,000 Jobs
Aside from the Wal-Mart co-manager layoffs and the cuts made to the corporate headquarters, the company will also shed thousands of workers as it shutters dozens of Sam’s Club stores across the country.
Wal-Mart’s Sam’s Club closing will leave about 9,450 people without jobs when all is said and done. Some employees of already shut stores showed up for work only to find they no longer had a job and the location had shuttered, the move was so sudden.
At least nine stores have already shut down, with more to come in the next few weeks.
The Wal-Mart Sam’s Club layoffs represent the single biggest hit the company’s workforce in the new year so far.
As many as 12 of the Sam’s Clubs that will be closed are set to be converted into e-commerce fulfillment centers as part of the company’s pivot toward online retail as it reacts to the changing face of the retail industry.
“Wal-Mart to ax 1,000 jobs, most at Arkansas headquarters, report says,” Arkansas Online, January 13, 2018.
“After bonus announcement, Walmart fires thousands of co-managers, replaces them with cheaper workers,” ThinkProgress, January 13, 2018.