Macy’s department store is laying off 2,500 employees and closing five stores as part of a major reorganization, the company announced on Wednesday. The news was welcomed warmly by the marketplace, with Macy’s shares shooting up 5.5% in after-hours trading.
The layoffs and other changes, which Macy’s estimates will save about $100 million annually, come despite strong sales in new stores and online. The company said sales at stores open for at least a year grew 3.6% in the past two months of 2013.
“Our company has significantly increased sales and profitability over the past four years,” Terry J. Lundgren, Macy’s CEO, said in a statement. “We have identified some specific areas where we can improve our efficiency without compromising our effectiveness in serving the evolving needs of our customers.”
Some Macy’s employees will be moved to other retail stores or to the company’s online operations as part of the reorganization, the Associated Press reports. The Cincinnati-based company’s total workforce will be about 175,000 employees.
Macy’s will also open eight new stores.
More Must-Reads From TIME
- Meet the 2024 Women of the Year
- Greta Gerwig's Next Big Swing
- East Palestine, One Year After Train Derailment
- In the Belly of MrBeast
- The Closers: 18 People Working to End the Racial Wealth Gap
- How Long Should You Isolate With COVID-19?
- The Best Romantic Comedies to Watch on Netflix
- Want Weekly Recs on What to Watch, Read, and More? Sign Up for Worth Your Time
Contact us at firstname.lastname@example.org