The Labor Department announced Friday that retailers cut around 30,000 positions in March, with more than 8,500 physical stores on track to close this year, National Post reports. Urban Outfitters CEO Richard Hayne estimates that the decline is due to the fact that malls in recent years have added too many clothing stores: "This created a bubble, and like housing, that bubble has now burst," Hayne said. "We are seeing the results: Doors shuttering and rents retreating. This trend will continue for the foreseeable future and may even accelerate."
Payless ShoeSource filed for Chapter 11 bankruptcy earlier this month and is set to close 400 stores across the U.S. and Puerto Rico. Rue21, which has about 1,000 teen clothing stores, is also expected to file for bankruptcy in April. Sears, Macy's, and J.C. Penney are also closing hundreds of stores.
To date, about 2,880 stores have closed in 2017, compared to 1,153 stores over the same period in 2016. Christian Buss of the Credit Suisse Group said that by extrapolating from this, there could be a staggering 8,640 store closures in 2017. At the peak of store closures, in 2008, only 6,200 stores shuttered over the course of the year.
"Today, convenience is sitting at home in your underwear on your phone or iPad," Buss said. "The types of trips you'll take to the mall and the number of trips you'll take are going to be different."