Macy’s to close 40 stores, cut thousands of jobs following disappointing holiday sales

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An exterior photograph of the Macy's Herald Square flagship store.

The pink slips are flying at Macy’s following a holiday season clouded by warm weather.

The iconic department store announced plans on Wednesday to lay off about 4,350 employees across the country.

Macy’s said about 3,000 sales associates will be impacted, or about three to four per Macy’s and Bloomingdale’s location. The company expects that about half of the affected store associates will be “placed in other positions.”

Another 1,350 employees in back office and service center positions will be impacted by the cost-cutting moves. Some of those workers too are expected to be reassigned to other jobs, Macy’s said.

Upper management is also being impacted, with Macy’s implementing a “voluntary separation opportunity” for about 165 senior executives.

All told, Macy’s hopes to save about $400 million to help offset its “disappointing” 2015 results.

It was fresh evidence of the struggles at Macy’s. The company said sales in the critical November and December period slumped by a worse-than-expected 5%. Profits are also expected to miss the company’s own targets.

Like other retailers, Macy’s blamed the “historically warm weather” in northern climates. Macy’s said about 80% of its sales declines can be attributed to shortfalls in cold-weather goods like coats, sweaters, hats, gloves and scarves.

Macy’s also pointed to the impact of the strong U.S. dollar, which has caused international tourists to spend less.

The struggles are forcing Macy’s to close stores. On Wednesday the company listed 36 stores slated to close early this spring, including ones in Los Angeles, Buffalo and Fort Worth.

Macy’s expects the cost-cutting moves to hurt fourth-quarter profits by $200 million.

Still, Wall Street cheered the belt tightening, bidding Macy’s shares up nearly 6% in after-hours trading on Wednesday. The stock lost nearly half its value in 2015, making it one of the worst performers in the S&P 500.

Macy’s Store Closings

Final clearance sales at the following Macy’s stores closing in early 2016 will begin on Monday, Jan. 11 and run for between eight to 12 weeks (with the exception of Westfield Century City, North DeKalb Mall and Roseburg Valley Mall, where final clearance sales are already in progress):

  • Downtown Spokane, Spokane, WA (374,000 square feet; opened in 1947; 94 associates).
  • Pony Village Mall, North Bend, OR (41,000 square feet; opened in 1980; 54 associates);
  • Roseburg Valley Mall, Roseburg, OR (40,000 square feet; opened in 1980; 59 associates);
  • Palouse Mall, Moscow, ID (41,000 square feet; opened in 1979; 47 associates);
  • Irvine Spectrum, Irvine, CA (140,000 square feet; opened in 2002; 112 associates);
  • Country Club Plaza, Sacramento, CA (165,000 square feet; opened in 1961; 111 associates);
  • Westfield Century City, Los Angeles, CA (136,000 square feet; opened in 1976; 108 associates). Note that this store will be closed in January 2016 and replaced with a new, larger store to open in this same shopping center in spring 2017;
  • Enfield Square main store, Enfield, CT (166,000 square feet; opened in 1971; 84 associates);
  • Enfield Square furniture/home/men’s store, Enfield, CT (76,000 square feet; opened in 1971; 20 associates);
  • North DeKalb Mall, Decatur, GA (190,000 square feet; opened in 1965; 89 associates);
  • Kailua, HI (59,000 square feet; opened in 1946; 57 associates);
  • Northwoods Mall, Peoria, IL (165,000 square feet; opened in 1985; 62 associates);
  • Cortana Mall, Baton Rouge, LA (243,000 square feet; opened in 1976; 108 associates);
  • Valley Mall, Hagerstown, MD (120,000 square feet; opened in 1999; 59 associates);
  • Berkshire Mall, Lanesborough, MA (111,000 square feet; opened in 1994; 58 associates);
  • Eastfield Mall, Springfield, MA (127,000 square feet; opened in 1994; 71 associates);
  • The Shoppes at Stadium, Columbia, MO (140,000 square feet; opened in 2003; 81 associates);
  • Middlesex Mall, South Plainfield, NJ (81,000 square feet; opened in 1976; 69 associates);
  • McKinley Mall main store, Buffalo, NY (88,000 square feet; opened in 1989; 65 associates);
  • McKinley Mall home store, Buffalo, NY (31,000 Square feet; opened in 1989; 10 associates);
  • Arnot Mall, Horsehead, NY (120,000 square feet; opened in 1995; 79 associates);
  • Hudson Valley Mall, Kingston, NY (121,000 square feet; opened in 1995; 72 associates);
  • Eastern Hills Mall, Williamsville, NY (127,000 square feet; opened in 1971; 80 associates);
  • Cary Towne Center, Cary, NC (107,000 square feet; opened in 1991; 63 associates);
  • Chapel Hill Mall, Akron, OH (169,000 square feet; opened in 1967; 91 associates);
  • Midway Mall, Elyria, OH (105,000 square feet; opened in 1990; 64 associates);
  • Quail Springs Mall, Oklahoma City, OK (146,000 square feet; opened in 1986; 87 associates);
  • Suburban Square, Ardmore, PA (102,000 square feet; opened in 1930; 74 associates);
  • Century III Mall, West Mifflin, PA (173,000 square feet; opened in 1979; 101 associates);
  • Ridgmar Mall, Ft. Worth, TX (181,000 square feet; opened in 1998; 92 associates);
  • Chesapeake Square, Chesapeake, VA (95,000 square feet; opened in 1999; 69 associates);
  • Virginia Center Commons, Glen Allen, VA (110,000 square feet; opened in 1993; 81 associates);
  • Peninsula Town Center, Hampton, VA (173,000 square feet; opened in 1977; 109 associates);
  • Military Circle Mall, Norfolk, VA (153,000 square feet; opened in 1976; 95 associates);
  • Regency Square main store, Richmond, VA (100,000 square feet; opened in 1990; 100 associates);
  • Regency Square furniture/home/men’s store, Richmond, VA (124,000 square feet; opened in 1990; 35 associates);

Macy’s stores closed in the final three quarters of 2015 (previously announced):

  • Owings Mills Mall, Owings Mills, MD (164,000 square feet; opened in 1986; 90 associates);
  • Bedford, NH (180,000 square feet; opened in 1966; 105 associates);
  • Essex Green Shopping Center, West Orange, NJ (93,000 square feet; opened in 1975; 101 associates). Note that this location was converted to a Macy’s Backstage store.
  • Downtown Pittsburgh, PA (1,158,000 square feet; opened in 1946; 170 associates).
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