Saks just announced it's cutting 1,100 positions, or 9 percent of its workforce. The company will also eliminate merit-based wage increases in 2009, suspend 401(k) contributions for at least a year, and suspend future benefit accruals for employees on the pension plan. By doing so, they expect to save from $50 million to $60 million. Saks chairman and chief executive officer Steve Sadove stated these are the most difficult economic conditions the 84-year-old company has faced:
"It is our expectation that the economic environment will remain extremely challenging through 2009, if not beyond...The cost and capital expenditure reductions are structured to minimize the impact on our customers, and the reduction in inventory receipts is reflective of the decrease in consumer demand. Each of our actions will benefit 2009 and should better position the company for the future, when economic conditions improve."
Most job cuts will take effect January 30. With the ongoing 80 percent off sale, we hope the company survives.
Saks Cuts 1,100 Jobs [WWD]