Job cuts due to retailer bankruptcies are way up this year compared to last, fueled largely by the closing of Toys “R” Us.
So far this year, employers have announced 33,530 job cuts due to bankruptcy, 30,212 of which were announced by retailers, according to a report by global outplacement and executive coaching firm Challenger, Gray & & Christmas. That's compared to 4,970 bankruptcy-related job cuts last year. The largest announcement this year came from Toys "R" Us, which in March eliminated 30,000 jobs when it filed for bankruptcy and ceased operations.
Challenger has tracked 1,127 store closures due specifically to bankruptcy in 2018. This is in addition to the 4,156 retail store closures due to bankruptcy announced through all of 2017.
"Like many industries this year, retail is responding to changing consumer demands and the implementation of new technologies that are disrupting how, where, and when consumers purchase goods and services," said Andrew Challenger, VP Challenger, Gray & Christmas. “As a major industry, employing tens of thousands across the country, the potential loss of jobs will be significant. However, the new technologies implemented during this period across the industry could lead to an influx of jobs that require a higher level of skills, meaning those positions may demand higher wages and better benefits.”
In other job-related news, Challenger has tracked 714,000 hiring announcements for the holidays, the highest number since the firm began tracking individual announcements in 2012. Traditional retailers have announced 427,000 of those hiring plans.