Walmart has joined the list of big companies that are planning to lay off staff, this has led to another massive job cut at Walmart, as the company plans to lay off another set of hundreds of workers, marking Walmart as another organization with significant cut jobs in the past few months.
The Great Layoff
Walmart is far from being the only company to undergo layoffs amid higher inflation, recession fears, and a whiplash in pandemic-induced demand. As of the past few months, Facebook’s parent company, “META” reported 11,000 job cuts announced since November and the 10,000 announced recently, which would bring Facebook’s headcount down to around 66,000 — a reduction of about 25%.
In the first months of this year, Amazon (AMZN), Google-parent Alphabet, and Microsoft (MSFT) have all confirmed major job cuts impacting tens of thousands of tech workers. According to CNBC, the situation changed radically for the e-commerce giant and other tech companies as pandemic restrictions eased and people returned to their offline lives. Walmart’s core business was also hit amid recession fears.
In less than four months countless companies such as Walmart, Glassdoor, Amazon, Meta, Citigroup, and Twitter just to mention a few have all fired staff to cut excess expenses.
Fears of an upcoming recession have already led retailers to announce 17,456 job cuts so far in 2023, compared with 761 in the same period last year. The company made it clear that in the course of finding a turnaround plan for excess spending, Walmart will reevaluate all aspects of its enterprise and reset elements of its e-commerce company. As their strategic direction changes, they hope to streamline their operations.
Walmart staff layoffs
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The e-commerce sector is affected at large
Amazon also announced that it will initiate 9,000 job cuts this March, which follows the previous 18,000 layoffs in January. Amazon has also closed, canceled, and delayed the opening of new warehouses, as some online sales shifted back to stores.
Target also announced plans to cut up to $3 billion in total costs over the next three years. All around the world from Chinese Alibaba, all the way to Ebay and now Walmart, the global E-commerce sector has not been fruitful this year. This has now gone worse as the banking sector in both the United States and Europe all all facing major challenges after the gradual increases in Interest Rates Globally.
Reason behind Layoff
These massive layoffs, the company confirmed were due to a reduction or elimination in evening and weekend shifts, a spokesperson confirmed to Reuters. As many economists have predicted a possible recession this year in the United States, the layoffs at Walmart, a retail bellwether because of its size, could be a harbinger of further turmoil in the US economy.
Walmart also anticipates slower sales growth and lower profits in the coming fiscal year. The company hinted starting this year that it expects sales for its United States business to grow between 2% and 2.5%, excluding fuel. That is a piece of good news though as it compares with 6.6% growth in the previous fiscal year.
Bright Future Ahead at Walmart
Walmart confirmed that sales have continued to grow, though at a slower pace than during the peak of the pandemic. E-commerce sales for Walmart’s U.S. business rose 12% in the most recent fiscal year, which ended Jan. 31. That compares with 11% growth in fiscal 2022 and 79% in fiscal 2021.
Where is the money going?
Walmart said they have been investing heavily in automation over the past few years, partnering with companies such as Knapp to help it cut down the number of steps it takes employees to process e-commerce orders to five from 12, which has been implemented at its Pedricktown fulfillment center as well as New Jersey fulfillment center.
