Weaker than projected holiday sales leads Plano, Texas based retailer J.C. Penney to close 33 stores and cut 2,000 jobs as the department-store chain continues to struggle to return to profitability. The announcement comes weeks after the company reported worse than expected third-quarter losses. The steps are projected to save more than $65 million annually. JCP now employees 116,000 workers at more than 1,100 stores.
Following a weaker than expected holiday season that saw stores cut prices earlier and by more than in recent years it is likely that Penney is just one of a number staffing cuts and store closings that will be announced over the next few weeks. Macy’s Inc. announced last week that they were slashing 2,500 jobs as part of a reorganization to stay profitable.
The already announced job losses, along with those still to come, add to what is still a sluggish rebound in the jobs market despite a drop to 6.7 percent in the unemployment rate. The number of people in search of work continues to be triple the number of jobs available, and the thousands of cuts coming will add to the already strained unemployment payout cost.
According to the January Employment Situation report from the US Department of Labor, there are 10.1 million unemployed persons, including 1.2 million classified as long-term, already. Can the economy absorb thousands more and continue what is already the slowest recovery in our nations’ history- or will it slow even more?
The ongoing discussion over how to deal with the long-term unemployed highlights the worsening situation in the jobs market. How long can the government pay those that have been out of work for two+ years? While extensions are needed, they must be paid for and they can’t be extended forever. Good paying jobs must be created for the recovery to gain any traction, and the continued failure to do so only adds to the strain placed on the entire system.
Our nation now has nearly 40 million people receiving “food stamps” and ten million + receiving unemployment benefits-this is just not sustainable. While lip service is given to job creation, the reality is that much of the drag on creating jobs is a direct result of policies put in place by the current administration that slow job growth.
Policies that have resulted in increased uncertainty about the cost to businesses that result from new regulations has led to delayed expansion, cuts in hours worked and reductions in workers. Jobs should be the top priority of all those elected to represent us, for without jobs our nation’s economy will never recover.
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