GOING DOWN, GOING BUST, GOING OUT

BIG BANKS SLASHING BRANCHES. In late January, TD Bank announced the closure of 81 of its 1,223 U.S. branches by April, joining KeyCorp, Huntington Bancshares, the Bank of Hawaii, and National Bank Holdings in shutting branches as deposits, withdrawals, and other transactions increasingly take place online.

From March through May 2019, Wells Fargo saw a 35-percent jump in digital deposits to checking accounts, the bank told the Financial Times.

The pandemic and restrictions on movement sped up KeyBank’s digital transformation by five years, CEO Christopher Gorman said last September, as reported by Forbes magazine.

The number of U.S. bank branches dropped by 5.1 percent from 2017 through 2020, with more than 4,400 branches disappearing during that period, according to the National Community Reinvestment Coalition.

Since 2008, when the Great Recession struck, more than 13,400 bank branches have been shuttered, about 14 percent of the U.S. total, the coalition reported.

Bank mergers also have added to the number of closures.

The loss of branches is especially devastating to rural and low-income urban areas where financial services often already are scarce, noted Jesse Van Tol, CEO of the National Community Reinvestment Coalition.

SEARS CLOSES 20 PERCENT OF REMAINING STORES. In late January, Sears announced the pending closure of another ten of its remaining 46 U.S. stores.

Sears began 2019 with 489 stores. The remaining Sears stores are likely to close within a year.

Transformco, which owns Sears, also owns Kmart, which has shriveled its number of locations from 360 to 30 in the last two years.

CHESAPEAKE ENERGY CUTS WORKFORCE BY 15 PERCENT. Chesapeake, an early and prominent company in the shale fracking boom, will dispense with 220 workers, or 15 percent of its staff, under a plan that will infuse $1 billion into the company and bring it out of bankruptcy this week. The arrangement leaves lenders in control of the business.

Most of the cuts will be made at the company’s Oklahoma City headquarters, Chesapeake said in an e-mail to employees.

L’OCCITANE INC. GOES BUST. The beauty products retailer with more than 150 U.S. stores has filed Chapter 11 bankruptcy in New Jersey. 

The move does not include the L’Occitane en Provence brand, its subsidiaries, or any operations outside the U.S.

The pandemic and economic shutdown robbed the company of its ability to continue to pay high rents in posh locales. L’Occitane said it will use the bankruptcy process to renegotiate rent rates with landlords and “right-size” its number of brick-and-mortar stores.

CANADA’S “AIRPORT TOWN” LOSES 290 JOBS. Gander, a Newfoundland town of about 11,600 residents, is losing 600 jobs from its Gander International Airport, which also is used by aircraft of Canada’s air force.

Sixty percent of the disappearing jobs are among airline employees; 40 percent are among ground crews and others who work for the airport itself.

The airport accounts for 20 percent of the jobs in town, which pay salaries and wages 20 percent above the region’s mean annual income.

Before the pandemic, the airport managed a dozen flights a day among six airlines; currently, only the regional PAL short-hop carrier is flying in and out of Gander.

Gander officials have joined the chorus of voices imploring the Canadian government for financial aid for the airline industry.

AIRLINES WARN OF MORE JOB CUTS. At least 14,000 United Airlines employees may lose their jobs when the current $15 billion in federal aid to air carriers dries up on 31 March.

Hawaiian Airlines has put 900 workers on notice and American Airlines’ flight attendants union said the airline has told it to expect layoffs.

MPA LAYS OFF 200. The Massachusetts Port Authority (MPA) is dispensing with about 200 workers in the face of historically low traffic at Boston’s Logan International Airport. The layoffs are part of the agency’s plan to reduce its’ roughly 1,200-person workforce by 25 percent, MPA noted.

Staff reductions began last fall, with eligible employees being offered a $20,000 buyout.

The MPA will lose $400 million through 2024, it has projected, forecasting air passenger traffic to be about 30 percent of pre-pandemic levels over that period.

JOHN LEWIS PARTNERSHIP TRIMMING 1,500 WHITE COLLARS. The British conglomerate of retail and financial service businesses is lopping 1,500 corporate office jobs as part of a five-year turnaround plan revealed last November to save £300 million.

The company also will close eight of its department stores and four grocery stores, shedding an additional 1,324 jobs. Workers losing their jobs will be redeployed within the company as possible; those not finding new berths will receive funding for retraining for other work.

The partnership also announced it will repay a £300-million government support loan two months ahead of schedule. 

BRITISH AUTOMAKERS SEE MORE LAYOFFS AHEAD. The 10,000 jobs the U.K.’s vehicle makers dumped last year was only the beginning, analysts say, after the industry suffered its worst sales year in 2020 since 1984.

Vehicle production plunged 29 percent last year to 920,928 units, the first time since 2009 that the industry has turned out less than a million cars and trucks, according to Britain’s Society of Motor Manufacturers and Traders.

Last year’s layoffs were the tip of “an iceberg,” society CEO Mike Hawes told the Financial Times

Britain will not equal 2016’s record 1.7 million vehicles produced for years, he added.

“Over the next few years, we need to make sure that we retain what we currently have.”

2020 SALES “FELL OFF A CLIFF,” SAYS RETAILER. Peter Higgins, cofounder of British clothier Charles Tyrwhitt Shirts Limited, did not reveal the degree of revenue loss for 2020 but warned that "a few more" of its more than 400 stores could close this year, in addition to four already shut down in 2020.

Remaining stores have survived on a combination of rent cuts, rent deferments, and staff layoffs, he said to the Financial Times.

The company attributes its troubles to white-collar workers no longer needing to dress for the office or social events.

If the COVID vaccines are deployed quickly enough to lift Britain's current lockdowns by mid-May, the company could break even this year, co-founder Nick Wheeler added.

DSW LAYS OFF 92 IN TRANSITION. The Ohio-based shoe and fashion accessories retailer will terminate 92 customer service jobs at one Ohio location and shift most of the rest of the remaining reps to a third-party call center.

The company will work to place the jobless workers within its stores or distribution centers in the area, a spokesperson said in a statement announcing the changes.

Designer Brands, DSW’s parent company, earlier revealed plans to abandon as many as 100 of its 669 North American storefronts as shoppers stay home and buy online, although it will retain “a physical presence in most geographic markets,” the statement said. 

LUBY’S SHUTS DOWN. The Texas cafeteria chain lost $3 million in the first quarter of its fiscal year and the company's liquidation is "imminent," according to government documents reported by Austin television news station FOX 7.

“The likelihood is remote that we will return from liquidation,” Luby’s stated in the documents.

Last June, Luby’s announced that would sell off all its assets to pay debts; in September, the board of directors approved a plan to dissolve the company. Nine of the restaurants are still open but will close before the end of this year unless the company sells them to a new owner willing to keep them open.

VIPLUS LAYOFFS WILL HAVE “DOMINO EFFECT.” The Australian milk producer Viplus has laid off 31 workers at its plant in Toora, a farming community of 681 people, because “business and economy and the international markets aren't rebounding as quickly as everyone had hoped,” CEO Jon McNaught said.

The layoffs will have an economic “domino effect” on the little town and surrounding area, local merchants said.

KNOTEL BOOTS TENANTS, FILES BANKRUPTCY. On 29 January, the shared-workspace landlord e-mailed tenants in its two million square feet of New York City office space, telling them to gather their belongings and clear out by 3 PM.

On 31 January, the once-billion-dollar company filed for U.S. bankruptcy and announced it was being bought by Newmark, the 92-year-old international real estate services firm.

Newmark, Knotel’s largest investor, will provide $20 million to see the company through bankruptcy, Newmark said in a statement reported by Business Insider.

Knotel acknowledged losing more than $202 million during the first ten months of 2020 as the economy crashed, tenants were unable to pay rent, and Knotel owed monthly lease payments on as much as five million square feet of office space in several countries.

The company then was hit by dozens of lawsuits from creditors and property owners. 

The bankruptcy applies only to Knotel’s U.S. operation.

3 Comments
  1. HandsFree 4 months ago

    Train Wreck or Atomic Economic Bomb with the flash of light just seen and now the concussions and fires to come

  2. Derekzan 4 months ago

    All by design and the sheep stay huddled up in their yard pen… shaking in their boots….

  3. Craig Bradley 4 months ago

    Its NOT “Build Back Better”, but instead “Set them Up and Knock Them Down”, (First).
    Afterwards, rebuild according to Klaus Schwab and George Soros worldview.

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