Macy’s Ends January With a Massive Round of Cuts and Closures

Steve Cukrov /
Steve Cukrov /

The 2023 holiday season was rough on everyone. Even Macy’s is taking it on the chin, and on January 18th, the Wall Street Journal announced that the legendary store caught quite a shot with consumers stealing almost as much as they paid for. To help them stay on their feet, 2,350 jobs were cut, and five stores would be permanently closed. This reduction in force accounts for about 13% of their corporate staff and 3.5% of overall staff.

According to an unnamed Macy’s employee who spoke to MarketWatch about the layoffs, “As we prepare to deploy a new strategy to meet the needs of an ever-changing consumer and marketplace, we made the difficult decision to reduce our workforce by 3.5% to become a more streamlined company.” With pink slips starting on January 26th, many employees are on pins and needles awaiting the word on their fate.

One of the biggest reasons for this trimming of the fat is the $6 billion takeover bid that is on the table. Put on the table by Arkhouse Management and Brigade Capital Management back in early December 2023, the group wants to buy up all outstanding stock it doesn’t already own at a $21-a-share valuation. Feeling that the company is undervalued, they believe they can do better to realize the value Macy’s once held.

With Macy’s holding a peak price of $70 a share back in 2015, their reduction in employees and poorly performing stores should help to increase revenue across the board and get the stock valuation higher before they decide about the bid to take the company private. For investors, this is the best possible outcome, as current leadership has been regarded as being too nostalgic for the old days of doing business.