Lowe’s Layoffs 2019: Thousands Fired As Company Keeps Slashing Costs

Lowe’s Companies, Inc., the world’s second-largest hardware chain behind The Home Depot, has laid off thousands of its full-time employees and replaced them with contractual workers.

Lowe’s refused to specify how many thousand employees lost their jobs this time or which stores will be affected by these job losses. It currently has 1,725 stores throughout the United States. Lowe’s employs 190,000 full-time employees and another 110,000 part-time workers at these stores.

To replace these people, Lowe’s plans to outsource maintenance and assembly workers’ jobs to outside contractors to further slash costs. Assembly workers put together products such as wheelbarrows and grills, for example.

“We are moving to third-party assemblers and facility services to allow Lowe’s store associates to spend more time on the sales floor serving customers,” said Lowe’s in a statement to CNBC.

“Associates who were in these positions will be given transition pay and have the opportunity to apply for open roles at Lowe’s.”

The firings are the latest under new CEO Marvin Ellison, who only took over in July 2018. Since becoming top guy at Lowe’s, Ellison has approved shutting-down stores across the country and firing employees en masse to reduce costs.

Lowe’s is justifying the mass firings by saying these will allow store workers to "spend more time on the sales floor serving customers."

The terminated employees will receive transition pay and the chance to apply for other jobs in the company when these show-up. Employees won’t be guaranteed the same hourly pay as they received before, however.

In 2018, Lowe’s shut down 51 underperforming stores in the U.S. and Canada. It also closed its Orchard Supply Hardware chain, which it bought for $205 million in 2013.

Lowe's stock price fell 1.9 percent Thursday, closing at $99.49.

The epidemic of retail store closures in the U.S. continues. More than 7,000 store closures have been announced by U.S. retailers, according to Coresight Research, a retail and technology research firm.

This massive hemorrhaging might exceed 12,000 by the end the year, which will be a record. In 2018, Coresight tracked 5,524 store closures, down more than 30 percent from an all-time high of 8,139 closures in 2017.