Additional Coverage:
Target Announces Major Corporate Layoffs Amidst Sales Slump
MINNEAPOLIS, MN – Target Corporation has announced its most significant round of corporate layoffs in a decade, impacting approximately 1,000 employees. The news comes as the retail giant grapples with a prolonged period of declining sales, raising concerns for affected staff, particularly as the holiday season approaches.
While the company attributes the workforce reduction to a strategic effort to streamline operations and enhance agility, the decision follows three consecutive quarters of falling sales.
Why the Workforce Reduction?
According to an internal memo from incoming CEO Michael Fiddelke, the corporate layoffs are not primarily a cost-cutting measure. Instead, Fiddelke stated, “the complexity we’ve created over time has been holding us back. Too many layers and overlapping work have slowed decisions, making it harder to bring ideas to life.”
The objective, as outlined by Target, is to eliminate corporate “red tape” to foster “progress and growth,” allowing the large corporation greater flexibility and the ability to act more swiftly in a competitive market.
Target’s Sales Decline
Despite the company’s official explanation, the timing of the layoffs coincides with a notable decline in Target’s financial performance. The retailer’s sales have been on a downward trend for three straight quarters.
Earlier this year, Target faced customer backlash after scaling back its Diversity, Equity, and Inclusion (DEI) initiatives, a move that some analysts suggest contributed to a shift in consumer spending.
An August earnings report revealed a 1.9% drop in Target’s second-quarter comparable sales and a 19.4% decrease in operating income compared to the previous year. The company’s stock price has also seen a significant decline, falling 30% this year and 65% from its peak in 2021.
Scope of the Layoffs
Target plans to lay off 1,000 corporate employees. Additionally, 800 open positions will be eliminated, meaning these roles will not be filled. In total, the cuts will affect approximately 8% of Target’s global corporate workforce.
Affected employees are expected to receive notification on October 28. The company has committed to providing pay and benefits through January 3, 2026, along with severance packages.
Impact on Shoppers
For regular Target shoppers, the company assures that the layoffs will not affect in-store operations or supply chain functions. The reductions are exclusively at the corporate level, meaning consumers should not anticipate any disruptions to store hours, product availability, or online order fulfillment, particularly in the lead-up to the busy holiday shopping season.