Wal-Mart Stores Inc. is planning job cuts at its headquarters that could involve hundreds of workers, including senior managers, according to people familiar with the situation.
The cuts are expected to begin in the next week, said the people, who asked not to be identified because the deliberations are private.
The move is part of Chief Executive Officer Doug McMillon’s efforts to reduce costs at the retailer while it boosts investment in other areas, including higher wages for store workers. The company has about 19,000 employees at its headquarters in Bentonville, Arkansas.
McMillon has been working to balance a desire to improve Wal-Mart’s customer service — partly through increased spending on his workforce — against pressure from investors to keep profit growing. Labor costs, increased by Wal-Mart hiking its minimum wage to $9 an hour in April, have weighed on earnings, which missed analysts’ estimates last quarter. At the same time, Wal-Mart is trying to maintain low prices to fend off rivals.
The job cuts were previously reported by the Wall Street Journal. Deisha Barnett, a spokeswoman at Wal-Mart, declined to comment.
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SOURCE: Bloomberg, Shannon Pettypiece