12,000 employees of Starbucks in the United States are set to lose their job after the company decided to downsize its operation and close down 600 of its outlets.

With the US economy facing downturn and uncertainties, consumers are looking for ways to cut their daily spending, and many of them are not in the mood for spending too much on Starbucks drinks, which cost between 3 to 4 dollars per cup.

Coupled with the increasing competition such as McDonald’s and Dunkin’ Donuts, the Starbucks top guns felt slashing off jobs as the way to go.

The 600 odd outlets affected are either under performing or unprofitable, and their operations are too close to another company-operated outlet. In the recent years, criticism has been thrown at the company for opening too many Starbucks outlet in one single building.

The 12,000 employees are made up of full time, part time and temporary workers. Plans for new store opening have also been halted immediately following the move. Following the news, analysts are expecting the company to return to profitability by end of the year.

Starbucks, a Seattle-based life style coffee shop, is the largest coffeehouse chain in the world, operating in over 40 countries worldwide, through more than 15, 000 outlets worldwide.

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