Retail: An apocalyptic wave of layoffs
Stores are starting to lay off workers en masse, said Sapna Maheshwari and Michael Corkery in The New York Times. This week, Macy’s, Kohl’s, and Gap furloughed nearly 300,000 workers, joining a growing list of retailers that “are not involved in selling groceries, toilet paper, or disinfectant.” The furloughs mean that workers will not be paid, though they will retain benefits. Many stores had hoped to keep workers on through Easter, but with social-distancing guidelines extended, “the money is drying up.” Furloughed employees can theoretically speed up a return to business, because retailers would not have to hire new staff—that is, if those stores can hang on.
Rent was due this week, said Natalie Wong in Bloomberg.com, and many businesses are facing the reality that they cannot pay. “Cash-strapped retailers are stuck with lease obligations, while landlords have to pay their lenders, who in turn are looking to the federal government for help.” The owner of a fitness chain in Washington, D.C., said she would withhold her $600,000 rent payments for April and plead for abatements, echoing major chains such as Mattress Firm and Subway. But Taubman Centers, one of the country’s largest mall operators, “has told tenants they expect rent to be paid.” The situation is messy, “in large part because no one knows when it will end.” ■