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Macy's, Bon-Ton Cutting Jobs
By: Eric Reinhardt The Central New York Business Journal
Central New York will feel impact
February 6, 2009
Two well-known clothing retailers with locations in Central New York are cutting jobs, but in the case of one of the companies, it's not known what impact the reductions will have on the region's stores.
Citing current economic conditions and lower sales expectations in 2009, Cincinnati, Ohio-based Macy's Inc. (NYSE: M) announced Feb. 2 it would eliminate 7,000 jobs nationwide, representing about 4 percent of the company's total current work force of about 180,000 positions.
The Macy's job cuts include positions that aren't currently filled, according to the company. Macy's employees who are laid off will be provided severance benefits and outplacement assistance.
Macy's isn't releasing job-cut numbers for specific stores, but on average, the company plans to eliminate five or six positions per store, says Sharon Bateman, a Macy's spokesperson based in Cincinnati.
Macy's operates retail stores in Syracuse, DeWitt, Clay, New Hartford, and Johnson City.
The Macy's board of directors has also voted to slash its quarterly dividend to 5 cents per share of common stock from the current $13.25 per share. Also, Macy's will reduce the level of its match to employee 401(k) contributions in 2009. In addition, the company is eliminating merit salary increases for executive performance in 2008.
The company is also moving forward with its "My Macy's" initiative, a nationwide district structure meant to develop and implement more effective strategies for identifying and serving specific consumer needs location by location.
All Macy's stores nationwide will be grouped into 69 geographic districts that will average 10-12 stores each, effective in the second quarter
One of Macy's competitors, The Bon-Ton Stores, Inc. (NASDAQ: BONT), has cut 1,150 positions from its companywide work force of about 32,000, a reduction of about 3.5 percent.
Bon-Ton officials informed affected employees about the move on Jan. 29 and, in most instances, the reduction went into effect the following day, Mary Kerr, vice president of investor and public relations, said in an e-mail message.
The job cuts included positions that weren't filled, according to Kerr.
The reduction impacted 281 stores in 23 states, two corporate offices, and three distribution centers, according to Kerr.
The York, Pa.-based company isn't disclosing job-cut numbers for specific markets, so it's not clear how the layoffs have impacted stores in Central New York.
Bon-Ton operates retail locations at the Carousel Center in Syracuse, at the Camillus Commons, in the Oakdale Mall in Johnson City, in The Shops at Ithaca Mall in Ithaca, in Massena, and in Elmira.
Besides the job cuts, the company eliminated 2008 bonuses for senior executives and 2009 merit-based wage increases across the entire company. Additionally, the firm is suspending employer contributions to its 401(k) plan, according to a Bon-Ton news release.
The Bon-Ton Stores, Inc. operates under the nameplates Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's , and Younkers.
The retail industry overall has been decimated by poor holiday sales, which helped lead to a surge in layoff announcements in the first month of 2009. Retailers announced 53,968 job cuts in January, a record number for the industry and one of the largest one-month job-cut totals for any industry, according to a new report issued Feb. 4 by global outplacement consultancy Challenger, Gray & Christmas, Inc.
January 2009 retail layoffs surpassed the 2007 full-year total for this sector (51,036) by nearly 3,000 job cuts, according to the report.
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