In another setback to the US job market, Saks (Saks Incorporated), the popular upscale retailer in the US, will be downsizing its operation and cut more than 1,000 jobs as it facing the worst financial situation for more than eight decades since its existence.
The positions affected with the layoff range from the corporate function to retail and store support and represents about 9% of the company’s total workforce at the moment.
With the job cut, Saks hopes to save operational cost between $50 million to $60 million for the year 2009. Most of the workers affected will have their job terminated by end of January.
Apart from eliminating jobs, the company will be taking a few other steps to weather the difficult financial predicament including suspending matching contributions to 401(k) plan, deferring benefits accruals for employees and stopping its merit-based salary increase practice. It isn’t clear at the moment if the strategies outlined would help actually help the company and results can only be reviewed towards the end of the year.
The company remains optimistic that they are taking the first steps towards the right direction with the announcement.
Saks is a Fortune 500 company and is listed in the New York Stock Exchange (NYSE). It owns Saks Fifth Avenue in New York City, a department store selling high end and luxury clothing and accessories.