WALMART PLANS job cuts at Bentonville offices.
Walmart Inc. said Thursday that it is cutting some jobs at its Bentonville headquarters as a result of ongoing changes in its U.S. division.
The retailer didn’t say how many people it was letting go. Walmart spokeswoman Jami Lamontagne said Thursday afternoon that more information about the layoffs will be released “after we’ve completed our communication with associates.”
Lamontagne said the retailer is making “some additional changes this week” as it continues its efforts to make Walmart U.S. an “omnichannel organization.”
“Our customers want to have a seamless experience whether they’re shopping in our stores, using our app or shopping online at Walmart.com,” Lamontagne said. “Our goal is to deliver that experience while increasing innovation, speed and productivity.”
The nation’s largest private employer does not reveal how many people work at the campus it calls its “home office.” Walmart employs about 1.5 million people in the U.S. and 2.2 million nationwide.
Walmart has eliminated some jobs over the past year or so as it consolidated its online and physical store operations, although some personnel were absorbed into the merged units under the Walmart umbrella.
One notable move was the integration of Jet.com, the ecommerce company Walmart acquired for $3.3 billion in 2016 to better compete with online rival Amazon.com.
Carol Spieckerman, a retail consultant and president of Spieckerman Retail, said that
with so many disruptions currently at work, any one of them could easily justify layoffs for any retailer. But, she said, “the fact is Walmart executes waves of layoffs periodically,” and has fared better than most during the ccoronavirus crisis.
Mervin Jebaraj, director of the University of Arkansas’ Center for Business and Economic Research, said that while some people are connecting Thursday’s job cuts with the coronavirus pandemic, the two are not related.
Rather, the layoffs come as part of Walmart’s much-discussed long-term strategy, Jebaraj said.
Also, Walmart is focusing on expanding e-commerce rather than adding new stores, Jebaraj said. As a result, “they seem to have lost the departments that deal with new stores, such as design and real estate,” he said.
The layoffs don’t seem to be primarily a cost-saving measure, Jebaraj said. Grocery sales have remained strong throughout the pandemic, although that’s a lower-margin category. He said shoppers are still buying durable goods, apparel and general merchandise, with government stimulus checks likely helping with those purchases.
Walmart appears to have weathered the pandemic well, keeping stores open and adding more than 400,000 full- and part-time workers in its stores and supply chain to help deliver essential goods.
Walmart reported a firstquarter profit of $4 billion, up 4% over the previous year. However, the company removed its guidance for the rest of the fiscal year and said some expenses, like employee bonuses and other benefits, would likely be ongoing.
The company will report second-quarter earnings, covering May through July, on Aug. 18. Analysts surveyed by Thomson Reuters on average estimate pershare earnings of $1.23, down just slightly from $1.27 per share in last year’s second quarter.
Walmart shares closed Thursday at $130.12, down 57 cents, or 0.44%, on the New York Stock Exchange. Its shares have ranged from $102 to $134.14 in the past year.
With the exception of Walmart and a few other bigbox retailers, the pandemic has devastated much of the retail industry. Many chains that were already struggling have been forced to close stores or file for bankruptcy as shoppers have largely stayed home, and high unemployment has curbed spending.
With emergency unemployment benefits expiring, consumers who have not been called back to work will have less disposable income. That translates into lower sales, especially during the current back-to-school shopping season, said Mark Cohen, director of retail studies at Columbia University’s Graduate School of Business.
Spieckerman said alarming economic news and uncertainty over economic support for unemployed people exacerbate short- to midterm concerns.
Walmart’s customers “may be the hardest hit if relief isn’t forthcoming, so no doubt the company is looking ahead and reading the tea leaves,” she said. “Tightening up the ship in advance of potential ongoing downturns makes sense under these circumstances.”
Still, the layoffs will likely send “ripples of worry” across the retail industry “since Walmart stands out as a bellwether of overall retail health,” Spieckerman said.