Target Announces Urgent Layoffs of 1,800 Jobs to Rebuild Brand

URGENT UPDATE: Target has just announced plans to eliminate approximately 1,800 corporate jobs as part of a strategic move to streamline operations and rejuvenate its struggling brand. This drastic measure aims to address declining customer engagement and improve decision-making processes.

In a statement released on Thursday, Chief Operating Officer Michael Fiddelke, who is set to become the company’s CEO on February 1, 2024, confirmed that around 1,000 employees will receive layoff notices next week. Additionally, Target intends to close 800 vacant positions. These cuts represent about 8% of Target’s global corporate workforce, primarily impacting personnel at its Minneapolis headquarters.

The layoffs will not affect store employees or those in Target’s sorting, distribution, and supply chain facilities, according to a company spokesperson. This announcement follows a troubling trend for the retailer, which has struggled to compete against giants like Amazon and Walmart amid rising inflation and changes in consumer spending habits.

In his internal message to employees, Fiddelke expressed the need for change, stating, “The truth is, the complexity we’ve created over time has been holding us back.” He emphasized that too many layers and overlapping responsibilities have slowed decision-making, hindering the execution of innovative ideas. Fiddelke will share further details with employees on Tuesday and has advised Minneapolis staff to work from home next week.

Target, which operates nearly 2,000 stores across the United States, has faced criticism in recent years. Customers have reported issues with store cleanliness and inventory management, undermining its reputation as a budget-friendly retailer—often humorously referred to as “Tarzhay” for its upscale image.

In August, when Fiddelke was appointed as the next CEO, he outlined three urgent priorities: reclaiming Target’s leadership in product selection and display, enhancing the customer experience through better store conditions, and investing in technology. He reiterated these goals in Thursday’s announcement, labeling the layoffs as a “necessary step in building the future of Target and enabling the progress and growth we all want to see.”

Recent data shows that Target has recorded flat or declining comparable sales in nine out of the past eleven quarters. In its latest financial report from August, the retailer revealed a 1.9% drop in comparable sales for the second quarter, alongside a 21% decrease in net income.

As Target moves forward with these significant changes, the retail giant aims to reclaim its competitive edge and restore its appeal to consumers. Analysts and customers alike will be watching closely for the company’s next steps in this urgent transformation.