Target Corporation continues to hit headlines day by day as the aftermath of many problems result in the company begin forced to take action. Many problems are making Target’s company officials have to rethink decisions that were made in the last year and re-adjust the actions that they take to remain profitable.
As these problems have been making shares for Target fall the changes now being made to help the company stay in the clear and increase profit as they move on. But how long will Target have to make changes for the company and how many will suffer as a result?
One of the biggest changes currently being done by the company was announced just recently, as company spokeswoman Molly Snyder announced the company’s plan to cut at least 475 jobs. While specific information on which jobs would be cut was not released though data suggests many cuts to be made in marketing, finance, and technology services. The company stated that of those cuts at least 150 would be cuts at the company’s Minnesota headquarters.
Employees who are cut will be given a 45 day severance package. Some employees who have tenure may also be cut but may receive a larger severance package. The company employes 361,000 people at its 1,900 branches, making these cuts seem like a small number.
As many companies around the world are cutting high numbers of jobs from their stores and offices Target employees are hoping that this change will help the company recover without having to cut hundreds of more employees later in the year. Target shares have currently gone down from $1.5 – $1.6 to $1.2 – $1.3 after the Target data breach which left many customers unhappy and untrusting of Target.
Even though the company has experienced a fall in shares another change that Target will be making is a cut of another kind. While the company is continuing to recruit in some areas of the store, such as jobs in the mobile and internet expansion of the company (helping them compete with companies like Amazon.com), Target has also announced their plans to cancel out 700 positions which were not even filled, giving the company a chance to recover from losses without causing too much damage for employees.
Though the United States is suffering from the aftermath of the data breach Snyder said no cuts or downsizing would be made in Canada. Although recent reports are showing a less than desirable reaction from Canada consumers to Target’s expansion into the country.
Target Corporation hopes that all of the changes that are being made in the employee division will help them recover well as the sales rise again. Molly Snyder made many comments about the job cuts stating that she thinks it is necessary and will help them grow in the future. In the mean time one more change for Target is on the horizon and this change will still affect employees, but in a different way.
The other change that Target will be making, not only because of falling shares, but also because of ‘Obamacare’ laws is the act of dropping part-time employees from the company’s health insurance coverage. According to Target officials after ‘Obamacare’ keeping part-time employees, those who work less than 30 hours per week, on health insurance plans will be more expensive after the laws take place in March. While full-time employees who work more than 30 hours will still be offered affordable benefits through Target, the benefits received are most likely to change.
These types of changes have also been seen by other companies who are struggling to keep up with profits with the rise of health insurance costs. Companies, including Target are finding it easier and more affordable to just drop employees from coverage.
These changes are, so far, the only ones that Target has announced for the coming year. While the retail business is ever-changing Target is still fighting through lawsuits over the major data breach that stole thousands of credit card numbers and tons of other customer information, as well. Based on how these lawsuits turn out the company may end up making some more changes to recover. For now these are the changes that Target is making in hopes that shares will not continue to fall.
By Crystal Boulware