Fresh Round of Industry Layoffs

Jan 14, 2009 10:38 PM  By

As multichannel merchants assess the 2009 holiday sales shortfall and the bleak outlook for 2009, this week brought a new round of industry layoff announcements.

On the high end, luxury department store retailer Neiman Marcus Group announced Tuesday that it is cutting nearly 3% of its workforce, or about 375 jobs. “Associates at all levels and all divisions were affected,” says spokesperson Ginger Reeder.

Neiman Marcus several months ago had initiated a company-wide evaluation of division and corporate processes to identify efficiencies and ways to reduce operating expenses. “The negative impact of the current economic environment increased the urgency and importance of this effort”, Reeder says. The current eliminations were the result of this review, she notes, and “there may be more eliminations in future months.”

At the other end of the spectrum, discounted products merchant Sierra Trading Post on Jan. 13 announced a workforce reduction—its first in 23 years of business. The Cheyenne, WY-based mailer laid off nearly 10% of its 830 employees, or about 66 workers.

“It is with great pain that we made this decision,” said Sierra Trading Post president/founder Keith Richardson in a statement. “We avoided making it until we were certain the macroeconomic trends were not short-term. It is now unavoidable, and we are faced with a climate of shrinking retail sales for the foreseeable future. To ignore this trend would be irresponsible.”

As for mailers in the middle of the market, there were reports that country home products cataloger Plow & Hearth had cut at least 45 jobs in two rounds of layoffs last week, and that more cuts could come this week. Calls to Plow & Hearth’s parent company were not returned by press time.

And on the supplier side of the business, printer Quad/Graphics announced Jan. 12 that it will eliminate about 550 jobs in five states, or 5.6% of its domestic workforce.

The company is shutting down the equivalent of one plant’s worth of capacity immediately. Quad/Graphics said it’s aiming to reduce its production capacity to better match print demand, which has softened due to the economy.