Hundreds of Walmart employees could soon find themselves without a job after the US retail giant announced workforce cuts are on the horizon.

As reported by the Wall Street Journal, Walmart supposedly told workers in Dallas, Atlanta and Toronto to move to its central hubs in Bentonville, Hoboken, and Southern California.

The retail chain also asked its remote workers to come back to working in the office. While some staff will still be allowed to work remotely part time, they are required to be in the office for most of the work week.

As for the job cuts, experts believe the move is part of Walmart’s efforts to reduce costs across the company, especially since discretionary spending in the country remains strained.

Advisory firm Deloitte said many Americans are still choosing not to spend their money on clothing and other non-essential, discretionary merchandise. This has been the case since 2021.

The workforce cuts, as well as the return-to-office mandate, are expected to affect Walmart’s 2.1 million employees, which the company refers to as “associates”.

Walmart’s business woes

In April, Walmart announced it is shutting down its 51 health centres across five US states and its virtual healthcare service, claiming that the business model was not sustainable. The company opened its Walmart Health centres back in 2019.

“While our mission to help people save money and live better remains, today we are sharing the difficult decision to close Walmart Health and Walmart Health Virtual Care,” the retail chain wrote in a statement.

“Through our experience managing Walmart Health centres and Walmart Health Virtual Care, we determined there is not a sustainable business model for us to continue.”

In 2023, the company revealed its plans to automate the services for 65% of its stores by the end of 2026.

Walmart is expected to release its Q1 results this week.

No end yet for job cuts in retail and tech

Economic activity in the US is on the up, with companies posting hundreds of thousands of job openings at the start of 2024. In fact, the unemployment rate hovered at only 3.7% in March, which is close to the country’s half-century low.

However, massive job cuts still loomed over retail and tech companies including Nike, Estee Lauder, Google, Microsoft, Amazon, Sony, and Electronic Arts. In March alone, more than 90,000 people lost their jobs, making the highest number of cuts from US-based employers in a month since January 2023.

Andy Challenger, senior vice president at career services firm Challenger, Gray & Christmas, believes employers are choosing to streamline how they operate their business. Some have opted for a smaller workforce and fewer hubs.

“Many companies appear to be reverting to a ‘do more with less’ approach,” Challenger said in a Forbes article.

“While technology continues to lead all industries so far this year, several industries, including energy and industrial manufacturing, are cutting more jobs this year than last.”