Watch CBS News

Macy's To Cut 10,000 Jobs, Close Nearly 70 Stores Nationwide After Lackluster Holiday Sales

LOS ANGELES ( — Macy's says it is eliminating more than 10,000 jobs and plans to move forward with 68 store closures after a disappointing holiday shopping season.

The department store chain also lowered its full-year earnings forecast after sales at the retailer dropped more than two percent in November and December compared to the same period last year.

A Macy's spokesperson cited changing consumer behavior said its performance reflects the challenges that are facing much of the retail industry.

The company said the 68 store closures are part of the 100 closings it announced in August, including a 475,000-square-foot location in North Hollywood that opened in 1995.

Of the 68, three were closed by the middle of 2016, 63 will close in the spring and two will be closed by the middle of 2017, including a location at Simi Valley Town Center, where 105 people will get transferred or lose their jobs. Macy's estimates that in all, 3,900 employees will be affected by the closures.

Macy's also said it plans to restructure parts of its business and sell some properties. This will lead to the reduction of 6,200 jobs. The moves are estimated to save $550 million annually.

Overall, Macy's said, the job reductions represent about 7 percent of its workforce.

USC Marshall School of Business Professor Kyle Mayer says Macy's is stuck in the middle. Not high-end enough. Not cheap enough. And not convenient enough to compete with Amazon and all that online shopping.

"They have no clear strategy," Mayer said. "Who goes to Macy's? It's not clear anymore."

The company, which owns the Macy's and Bloomingdale's brands, has been struggling with declining traffic in its stores, where the bulk of its business is still conducted. It said it is closing stores that are "unproductive or are no longer robust shopping destinations" as well as selling those with highly valued real estate.

Macy's CEO said in a statement:

"Our plan to close approximately 100 stores over the next few years is an important part of our strategy to help us right-size our physical footprint as we expand our digital reach."

(TM and © Copyright 2017 CBS Local Media, a division of CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2017 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.