Nike’s Oregon office increases the number of layoffs planned for Jan. 8, 2021. Those numbers have gone up from 500 to 700 jobs that will be cut as part of a reconstruction plan unveiled last summer.
Their Child Development centers will take the majority of the job cuts because these centers are closing permanently. Members of their incorporated leadership team and interrelated managerial assistants will be included in these layoffs.
Employee Termination Cost
Related to these layoffs, the company will acquire employee terminations costs of $200-250 million. They further explain that these layoffs are not due totally to the pandemic, but are a critical spotlight on developing digital technology and growing the acceleration of distribution and implementation.
Nike’s new CEO John Donahoe refocuses their business plan to highlight online sales directly to consumers. They employ about 13,000 at its headquarters campus.
Company Quotes
A representative made a statement:
We are building a flatter, nimbler company, and transforming Nike, faster to define the marketplace of the future. The changes are expected to lead to a net loss of jobs, which is always difficult.
They believe that digital growth reflects a critical shift toward a new future marketplace, rather than being a temporary solution to coronavirus-related challenges in physical markets. Increased digital sales growth has been witnessed since the pandemic.
The Company’s shares gained 1.8 percent to close at $124.59 on Nov 3. The company has gained 23.4 percent in the past three months compared with the industry’s 20.1 percent rally.
Written by Omari Jahi
Sources:
Nasdaq: NIKE (NKE) Ups Layoffs Target to 700, Restructuring on Track, Zacks Equity Research
The Oregonian: Nike says HQ layoffs will hit 700 by January, up 200 from the prior forecast, Mike Rogoway
Yahoo! Finance: NIKE (NKE) Ups Layoffs Target to 700, Restructuring on Track, Zacks Equity Research
Featured Image by Choledocho Courtesy of Wikimedia – Creative Commons License
Inset Image by Steve Morgan Courtesy of Wikimedia – Creative Commons License
