Walmart Inc. is cutting staffing levels at some ecommerce fulfillment centers in the United States as the nation’s largest private-sector employer steps up investment in automation.
The retailer is working with the affected employees to find other positions at Walmart, according to a March 23 company statement. In a regulatory filing, Walmart provided advance notice of the cuts to 201 employees in Pedricktown, New Jersey. Reuters reported earlier that the potential impact extends to hundreds of other employees in California, Florida, Pennsylvania and Texas.
The move “was not made lightly, and we’re working closely with affected associates to help them understand what career options may be available at other Walmart locations,” the company said in an emailed statement.
The Bentonville, Arkansas-based company is paring jobs as it bolsters warehouse automation to reduce the cost of handling online purchases. The retailer has so far avoided the kind of mass layoffs underway at rival Amazon.com Inc., which this week said it would slash payrolls by another 9,000 jobs in addition to 18,000 recent cuts.
Walmart said last month it would close three of its 11 U.S. technology hubs and require affected workers to relocate. Employees who decide to quit will receive severance, the company said at the time.
The retailer raised its starting hourly wage to $14 from $12 earlier this year. Walmart has about 1.6 million U.S. employees.
Walmart ecommerce sales
In a call with Wall Street analysts following the earnings announcement, Walmart CEO Doug McMillon said ecommerce represents 13% of Walmart’s total global sales. Walmart said its digital sales rose 17% year over year in the fourth quarter.
In February, Walmart announced it would sell outdoor gear retailer Moosejaw Mountaineering to Dick’s Sporting Goods, then the latest instance of Walmart unwinding ecommerce-focused acquisitions it made from 2016 to 2018.
Walmart reported net income of $6.28 billion for its fiscal Q4. That’s up 76% from $3.56 billion a year earlier.
Walmart is America’s largest overall retailer and is No. 2 in the 2021 Digital Commerce 360 Top 1000, trailing only Amazon in annual ecommerce sales.
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