J.C. Penney to Cut Thousands of Jobs

by InvestorPlace Staff | January 23, 2012 11:27 am

Plans to revive struggling retailer J.C. Penney (NYSE:JCP[1]) have strayed primarily on the positive side, including new leadership and new product lines. According to the New York Post, however, the company likely will be moving forward with fewer workers.

A Post report[2] says J.C. Penney will lay off thousands of workers, effective today, affecting employees at almost all of its 1,200 U.S. locations. While a JCP spokeswoman said temporary workers held over from the holiday season will lose their jobs, unnamed Post sources said permanent jobs also will be affected.

These changes come before an expected Wednesday unveiling of new CEO Ron Johnson’s strategy for turning around the retailer. The former Apple (NASDAQ:AAPL[3]) retail chief took charge Nov. 1[4], and other former company bigwigs have joined his team to revitalize JCP.

One of Johnson’s biggest actions to date was the company’s partnership with Martha Stewart Living Omnimedia (NYSE:MSO[5]), announced in December, which included the purchase of a 16.6% stake[6] in MSO. Also part of the deal, J.C.Penney locations will roll out Martha Stewart stores-within-a-store — a move that rankled fellow retailer Macy’s (NYSE:M[7]).

J.C. Penney is just the latest big-name company to make jobs news in 2012. Morgan Stanley (NYSE:MS[8]) was considering more job cuts[9] after already laying off 1,600, and Novartis (NYSE:NVS[10]) announced this month that it would eliminate 2,000 U.S. jobs[11].

JCP shares moved little on the news, down just 4 cents in the morning from Monday’s opening of $35.09.

– Kyle Woodley, InvestorPlace.com Assistant Editor

Endnotes:
  1. JCP: http://studio-5.financialcontent.com/investplace/quote?Symbol=JCP
  2. Post report: http://www.nypost.com/p/news/business/penney_pinchers_HM6H3lqDL0FlxTzaeqnSMN
  3. AAPL: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAPL
  4. took charge Nov. 1: http://investorplace.com/2011/11/jc-penney-ceo-ronald-johnson-jcp-apple-aapl/
  5. MSO: http://studio-5.financialcontent.com/investplace/quote?Symbol=MSO
  6. purchase of a 16.6% stake: http://investorplace.com/2011/12/martha-stewart-living-jcpenney-jcp-mso-market-summary/
  7. M: http://studio-5.financialcontent.com/investplace/quote?Symbol=M
  8. MS: http://studio-5.financialcontent.com/investplace/quote?Symbol=MS
  9. considering more job cuts: http://investorplace.com/2012/01/more-bad-news-at-morgan-stanley/
  10. NVS: http://studio-5.financialcontent.com/investplace/quote?Symbol=NVS
  11. eliminate 2,000 U.S. jobs: http://investorplace.com/2012/01/novartis-cutting-2000-jobs-diovan-patent-expiration/

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