As coronavirus-induced store closures extend into April, H&M is the latest retailer to announce furloughs.
The Swedish retailer said that it has furloughed a portion of its workforce in the United States due to the “negative impacts” of the coronavirus crisis on business. The company did not specify how many workers are being impacted by the furloughs.
“This is an extraordinary situation in which we are forced to make difficult decisions,” an H&M spokesperson told FN in a statement. “We regret to say that we have found the need to furlough some members of our workforce in the U.S. due to the negative impacts the corona situation has had on our business.”
In H&M’s biggest markets, including Germany, the United Kingdom and the United States, all stores have temporarily closed. Of the company’s fleet of 5,062 units, 3,441 are shut. While consumers remain able to shop online, H&M said it saw a “significant negative impact” on revenues in March, coupled with “subdued demand” in the markets that remain open.
In a March 23 statement, H&M said that it was reviewing its operational costs, as well as taking “several measures” to reduce costs in the areas of buying, investments, rents and staffing. The retailer said it is assessing the situation on a market by market basis, taking into consideration local conditions. In addition to implementing furloughs within the U.S., the company has cut back hours for employees in some markets as a cost-saving measure.
The fast-fashion giant is not alone in furloughing workers as coronavirus-induced store closures in the United States extend into April. Saks Fifth Avenue, Macy’s and Famous Footwear parent Caleres are among the companies that have chosen to furlough retail employees in light of the pandemic.