In an era of fast fashion, fast food and fast internet, the old ways of doing business just don’t cut it. As more consumers shift to online shopping and business at many brick-and-mortar retailers slows, layoffs become inevitable. According to data compiled by outplacement firm Challenger, Gray and Christmas, job cuts so far in 2017 have been retail-heavy, a phenomenon known as “retail apocalypse.”
The retail free-fall has implications for shopping centers as well. JCPenney has been an anchor tenant at malls all over the country for decades, but the discount retailer has been struggling, and real estate experts are concerned about the future of malls. According to an analysis by global financial service giant Credit Suisse, 20% to 25% of all malls are expected to close in the next five years.
While retail is bearing the brunt of job cuts this year,the energy sector posted the most layoffs through the same period in 2016. The good news is the pace of layoffs appears to be slowing. There were nearly 360,000 announced job losses by the end of July of last year. So far in 2017, there are about 255,000 announced job losses.
Technology is not just upending the retail sector. One insurance company on this list has actually lost money because of higher claims costs from car crashes as more drivers are distracted by electronic devices.
To identify the 12 companies that are laying off the most workers so far in 2017, 24/7 Wall St. reviewed data on job losses per month compiled by Challenger, Gray and Christmas. Job cuts announced in 2017 but which only included positions cut in 2016 were excluded from the list. Layoffs do not have to be entirely within the United States. Job cuts were confirmed from data analysis, company announcements, media reports and press releases.
12. The State Department
> 2017 layoffs announced through July: 2,300
> Number of employees: 69,000
> 1-yr share price chg.: N/A
> Industry: Government
Secretary of State Rex Tillerson has proposed cutting 2,300 diplomat and civil servant jobs worldwide, or 3% of the department’s workforce, as part of a plan to adjust the department’s budget for the next fiscal year. Tillerson’s plan would cut the budget by 26% with 600 jobs eliminated through buyouts and 1,700 from attrition. The plan is in accord with President Donald Trump’s vision of a smaller federal government and reflects conservatives’ belief that government agencies have grown too large and are straying from their core mission.
11. Lowe’s Cos.
> 2017 layoffs announced through July: 2,400
> Number of employees: 290,000
> 1-yr share price chg.: -3.1%
> Industry: Retail
The home improvement category has been improving since the housing sector began to recover from the financial crisis. But that has provided little solace for the 2,400 workers at Lowe’s Cos. who got pink slips in February. The majority of the cuts were at the store level but affected positions at distribution centers, contact centers, and at the company’s corporate office in Mooresville, North Carolina, Lowe’s said. The announcement impacted fewer than 1% of the company’s 290,000 full-time and part-time workers.
Lowe’s has been struggling to compete with the sector leader, home improvement juggernaut Home Depot, which has boosted profitability by targeting contractors and small business. There was more disappointing news for Lowe’s on Wednesday that might presage additional job cuts. Second quarter earnings and sales fell short of analysts’ expectations.
10. The Hershey Company
> 2017 layoffs announced through July: 2,697
> Number of employees: 18,000
> 1-yr share price chg.: -6.2%
> Industry: Food
General Motors, the biggest American car company, notified 2,700 autoworkers in Venezuela by text this past April that they no longer had a job. The notice from GM to the workers followed the decision by the Venezuelan government to seize the company’s facilities. Venezuela President Nicolás Maduro said the seizure of GM’s plants is not permanent, and he is urging the automaker to come back to the South American country. GM, based in Dearborn, Michigan, said the seizure was illegal.