Walmart will cut 20 percent of its labor force to make the retailer more efficient and less prone to price hikes, the retailer’s top executive said Tuesday.
Walmart announced Monday that it will cut 4,000 positions to reduce costs and to simplify its operations.
CEO Doug McMillon told reporters at the company’s headquarters in Bentonville, Arkansas, that the job cuts will not impact the company as a whole.
“This is about making sure we are more efficient, that we’re less prone over time to price increases and the kind of thing that is driving some of the consumer behavior that we see out there,” he said.
McMillon did not give a specific number for the cuts, saying he wants to keep things simple.
The announcement comes as Walmart’s stock has been on an upward slide in recent weeks, which could hurt its ability to meet demand for its merchandise.
The company reported a $3.4 billion loss for the year ended June 30.
Walmart has struggled to make up for the decline in sales at its brick-and-mortar stores, which have fallen off sharply in recent years due to a shift toward online shopping and other services.
Walmart also announced Monday it plans to spend $1.6 billion to improve its quality of life and cut its workforce by 4,800 people over the next year.
While the layoffs will affect only about 2 percent of Walmart’s labor force, they represent a sharp shift for the retailer.
Walmart’s shares have risen over 20 percent over the past year, though they remain well below their peak in 2007, when the retailer was worth more than $100 billion.
Wal-Mart has long struggled with a labor shortage, with workers at its retail stores struggling to find jobs.
Last year, Walmart said it would hire 1,000 more full-time employees to meet a surge in demand for groceries and other items.
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