A Bankrupt Clothing Retailer Now Triggers Painful Layoffs in Ohio

A bankrupt clothing retailer now triggers painful layoffs in Ohio after announcing it would close nearly 100 stores.

Express has been battling lower volumes following its bankruptcy filing, prompting one of its logistics partners to trim the distribution services it provides to the retailer.

Last month, Bath & Body Works permanently reduced operations at a distribution facility in Columbus, Ohio, used to provide logistics and shipping services to Express, according to a June 18 Worker Adjustment and Retraining Notification Act notice.

The shift was attributed to “a continued decline in the volume of the logistics services provided to Express,” a Bath & Body Works spokesperson told sister publication Supply Chain Dive in an email.

Express is one of a host of other retailers that have filed for Chapter 11 bankruptcy protection this year, including fellow apparel company Rue21.

As part of its bankruptcy plan, Express announced it would close nearly 100 stores as lower demand impacted its supply chain.

The reduction at the Columbus facility will eliminate a total of 75 roles, the Bath & Body Works spokesperson said.

The impacted employees were offered severance or the ability to transfer to open roles within Bath & Body Works’ distribution center network.

At the end of fiscal 2023, Bath & Body Works owned five office, distribution center and shipping facilities in the Columbus region and used six third-party-operated regional distribution centers throughout North America, according to a securities filing.

Filing bankruptcy is not necessarily the end of the line for a retailer.

Department store giant J.C. Penney emerged from bankruptcy in 2020 and has doubled down on its supply chain capabilities since then.

Last year, the company announced plans to invest more than $1 billion to improve supply chain operations by fiscal 2025.

It already doled out $40 million to upgrade its distribution center in Reno, Nevada, earlier this year, reports RetailDive.

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Also Read: Retirees Will Now Receive More Money For Social Security

Other Economy News Today

Market News Today - A Bankrupt Clothing Retailer Now Triggers Painful Layoffs in Ohio.
Market News Today – A Bankrupt Clothing Retailer Now Triggers Painful Layoffs in Ohio.

Applications for unemployment benefits now surge to new highs, a sign that the white-hot labor market is starting to cool off.

First-time applications for unemployment benefits rose last week to 231,000, the highest level since August, per CNN.

Thursday’s data also showed that the number of continuing claims, or applications from people who have filed for unemployment for at least one week, was 1.78 million.

That’s an increase of 17,000 from the prior week, according to the Bureau of Labor Statistics.

The latest numbers come less than a week after the monthly jobs report showed the US economy added just 175,000 positions in April, less than economists expected and a steep drop-off from prior months.

US employers have now added an average of 245,500 jobs per month, versus 2023’s 251,000-per-month average.

Still, hiring remains strong. Although the unemployment rate ticked up to 3.9% last month, it’s the 27th consecutive month that the jobless rate has held under 4%, matching a streak last seen in the late 1960s.

Weekly jobless claims data tends to be volatile but, while one week’s worth of data “does not a trend make,” said Chris Rupkey, chief economist at Fwdbonds.

“We can no longer be sure that calm seas lie ahead for the US economy if today’s weekly jobless claims are any indication.”

Company layoffs are picking up, hinting at caution on the part of companies as they weigh the outlook for the second half of the year,” he wrote in a note Thursday.

The Federal Reserve has been battling inflation by raising its key lending rate in the hopes of slowing the economy.

While the labor market has so far resisted those efforts, remaining white hot for the past 18 months despite 11 rate hikes from the central bank, Fed Chair Jerome Powell said last week that demand has “cooled from its extremely high level of a couple of years ago.”

Ian Shepherdson at Pantheon Economics said in a note Thursday: “We’d need to see at least a month of elevated readings to convince us that the trend really has turned.”

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Also Read: A Giant Company Now Announces Unexpected Layoffs in Virginia

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Market News Today - A Bankrupt Clothing Retailer Now Triggers Painful Layoffs in Ohio.
Market News Today – A Bankrupt Clothing Retailer Now Triggers Painful Layoffs in Ohio.

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