Macy’s: What Recovery?

It is amazing to me thinking about the news in 2008 and comparing it to the news now. The economy was getting ready to crash and the liberal media was hammering Bush and the Republicans in general. The crash that finally came was a huge help to the Democrats with the media operating as their echo chamber.

Compare that to what is happening now. AP reports, “Macy’s cutting 4,800 jobs after dismal holiday sales, a harbinger of hard times for retailers.”

Macy’s is slashing jobs, a harbinger of hard times for retailers after a holiday season that saw a noticeable shift to online shopping and away from physical stores.

The nation’s largest department store chain, which also operates Bloomingdale’s, said late Wednesday it is cutting up to 4,800 jobs and trimming its profit outlook after a miserable holiday season.

“I think Macy’s is likely to be a canary in a coal mine,” said Ken Perkins, president of Retail Metrics, a retail research firm. He said retailers witnessed an acceleration of the shift toward online and mobile holiday spending in 2015.

About 2,110 of the job cuts at Macy’s will come from reducing staffing at stores, eliminating duplications in back-office operations and consolidating regional store groups. The remaining 2,710 job cuts will come from the store closings that Macy’s announced last fall, spokesman Jim Sluzewski said.

As of Wednesday, Macy’s had about 163,000 workers.

The moves are part of Macy’s ongoing campaign to position itself to compete in a retail world where increasingly demanding shoppers are going back and forth between stores and their mobile devices. Analysts expect more retailers to announce they’re shrinking their store counts further and making other moves to make their organizations leaner.

AP’s drivel about technology is an obvious diversion. I’m sure there has been increased online shopping, but I doubt that accounts for all of it. This is especially obvious when it is paired with the story’s description of “a retail world where increasingly demanding shoppers are going back and forth between stores and their mobile devices.” Which is it? Do they want to use the web and avoid shopping or are they going shopping in search of things to buy?

The reason they are using their mobile devices is because they can’t afford the price that the retail merchants are asking. When you read “increasingly demanding shoppers,” realize this refers to people who are more broke. They are too poor to simply go to Macy’s and buy what they want.

It’s the economy, not technology, that is hurting retailers.

The story also blames the weather:

Mother Nature also hurt holiday sales too, particularly at clothing stores. Unseasonably warm weather in some regions in the U.S. squelched shoppers’ demand for cold-weather goods.

How ridiculous. Year after year “disappointing” holiday sales have been blamed on cold weather. Now the same thing is blamed on warm weather.

But the idea that our president might bear some responsibility is not even considered. As I asked before when it was obvious that Macy’s wasn’t doing well: Why hasn’t any financial reporter looked at the devastating cost spikes in the Affordable Care Act and investigated how they might be affecting consumer behavior over the Christmas season?