The start of 2017, will be hard as retail giant Macy’s announces plans of store closures and employee layoffs. Macy’s announced that sales dropped 2.1 percent in November and December compared to last year. The company cited changes in consumer behavior and the current challenges in the retail industry. According to business analytics organization the NPD Group, “..in-store and online channels, dollar sales in the seventh week of the 2016 holiday shopping season were 11 percent lower than the same week in 2015. Cumulatively, dollar sales in the first seven weeks of the 2016 holiday shopping season were 4 percent behind the first seven weeks of the 2015 holiday season.”
Macy’s has announced that it will close 68 stores across the United States, which were part of an announced closing of 100 stores from August 2016. The company stated of the 68, three were closed by the middle of 2016, 63 will close in the spring and two will be closed by the middle of 2017. Combined with the selling of property holdings it is estimated that at least 10K employees will lose their jobs. Some will be offered other positions within the company but overall it will have devastating economic effects on the average worker.
The company was under pressure from investors to take drastic actions to increase profitability. Macy’s, like other retailers across the country, has seen shrinking profits as more people are buying through online companies. Over the past few weeks, Macy’s has seen its share price dip 10 percent in recent trading. The company now states that it expects to earn between $2.95 and $3.10 per share on an adjusted basis for its 2016 fiscal year, versus its prior forecast of $3.15 to $3.40 per share. The company is scheduled to report full results in February 2017.
Despite a dropping unemployment rate nationally, for Black Americans the news in 2016 was still bad. The unemployment rate of 8.8 percent for Blacks was more that double the rate for whites at 4.3 percent in 2016.