Chicago Retail Jobs with Neiman Marcus Cut
Posted on January 15, 2009
Those who have a Chicago retail job with one large company could soon be unemployed.
Neiman Marcus Group Inc. recently announced its plan to cut 375 jobs, or about 3 percent of the company’s workforce. The layoffs will affect varying retail jobs with different parts of the company, including corporate and store positions.
The company also will make interest payments for senior notes due in 2015 by issuing more debt rather than paying cash, according to an article by Reuters. The company, which operates luxury department stores, hopes the moves will help save money and further cut costs.
According to a filing with the U.S. Securities and Exchange Commission, the company is using a “payment-in-kind” option to pay the interest it owes. This allows the company to save cash by deferring interest payments and accruing more debt, which should result in savings of about $15 million per quarter.
The company’s Neiman Marcus and Bergdorf Goodman stores that have been open at least one year have seen sales decline by 31 percent. Neiman Marcus, which was acquired by a private equity group in 2005, has $576.3 million in unused borrowing available out of its $600 million revolving credit fund.
When compared to last year, the Chicago-Naperville-Joliet area as a whole continued to lose jobs during the last half of 2008. In November, the area had a total non-farm employment of 3,875,500 workers, according to the United States Department of Labor Bureau of Labor Statistics. This is down from 3,885,800 workers during October and a .9 percent decrease from last year. The area saw an over-the-year job decrease of .1 percent during June, .1 percent during July, .3 percent during August, .1 percent during September, .4 percent during October and .9 percent during November.
While the overall number of employees has been decreasing, Chicago’s unemployment rate also has lowered. The Chicago area had an unemployment rate of 6.3 percent during November, down from 6.4 percent during October and lower than the national unemployment rate of 6.7 percent.