Big cuts at Target offices

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This article was published 11/03/2015 (3886 days ago), so information in it may no longer be current.

MINNEAPOLIS — Target Corp. said it was wiping out 3,100 headquarters jobs, including laying off 1,700 people, with most learning their fate Tuesday.

The company elaborated for the first time on a plan announced last week to eliminate “several thousand” jobs, chiefly at its corporate offices in the Minneapolis area. In addition to the layoffs, Target said 1,400 open jobs will be unfilled.

“Today is a very difficult day for the Target team, but we believe these are the right decisions for the company,” the company said in a statement.

Throughout the morning, employees carrying personal belongings could be seen leaving the firm’s main tower.

The company said each employee who is cut will receive at least 15 weeks of pay plus additional severance based on their length of time with the retailer. Target said benefits will continue for six months and employees will receive outplacement support and other services.

In a filing with securities regulators, Target said it expects severance costs of about US$100 million, resulting in a charge against its first-quarter results.

The cuts began at the senior executive level last week, according to Target employees. One employee who declined to be identified said that probably a couple of dozen upper managers were let go Monday and gone by lunch.

Target executives announced the job cuts last week, saying they were needed to make the company a “much more agile, effective organization.”

The company, the fourth-largest retailer in the U.S. with about US$72 billion in annual revenue, employed 13,000 at corporate offices in the Twin Cities before the job cuts, which are the largest ever in its headquarters. Including another 14,000 people at stores in Minnesota, Target is the state’s largest employer after the state and federal governments and Mayo Clinic.

On Monday, Gov. Mark Dayton, whose father and uncles started Target in the 1960s, met with CEO Brian Cornell. Dayton told reporters he received an assurance from Cornell that Target was committed to Minneapolis and would keep its headquarters there.

Target endured slow sales growth over the last few years, though it remained one of the nation’s most profitable retail firms. Its stock has been trading at record highs. recently

Executives mishandled an expansion in Canada that resulted in several billion dollars in losses over the last two years. And in late 2013, a data breach put the private information of millions of customers at risk and damaged Target’s reputation.

Cornell decided in January to end the Canadian expansion, leading to 17,600 job losses in Canada and 550 corporate workers in the Twin Cities.

 

— Star Tribune (Minneapolis)