Nike to lay off more than 1,500 jobs during broad restructuring
Nike is cutting 2% of its current workforce as it looks to reinvest in its growth areas and streamline its business. The sneaker giant is contending with a slowdown in consumer spending and looking to save $2 billion over the next three years as part of a restructuring plan.
FollowNike, a major player in the apparel industry, said that it will reduce costs by eliminating around 1,600 positions, or 2% of its staff, following lower-than-expected profits this year. Adidas, Puma, and JD Sports, Nike's international competitors, have also issued warnings about lower profitability this year due to customers cutting down on non-essential spending.
Nike said in December that it will save $2 billion over the next three years by limiting the supply of some items, streamlining its supply chain, cutting back on management levels, and utilizing more automation. Additionally, the business had disclosed that it would spend between $400 million and $450 million on employee severance during the third quarter.
Nike had approximately 83,700 employees as of May 31, 2023, according to a company filing.
The layoffs are anticipated to begin on Friday, according to the Wall Street Journal, which broke the story first. A second phase is planned to be finished by the end of the current quarter. The report also stated that workers on its creative team as well as those in shops and distribution facilities are not anticipated to be affected by the layoffs. The most recent statistics available on layoffs.fyi shows that 39,496 people have been let go by 154 organizations in 2024.
Official figures released on Wednesday, meanwhile, revealed that the British economy entered a recession in the second half of 2023 after contracting by 0.1% between July and September and a less-than-expected 0.3% in the three months leading up to December. According to the Bank of England, growth in the economy is anticipated in 2024.
