St. Patrick’s Day Massacre
I have a couple of days off, so I can’t hear the locals reaction to this MOAB dropped in the hallways in Troy, Michigan today:
Bankruptcy blues: Kmart workers face job loss, tough search
March 17, 2003 BY JENNIFER BOTT FREE PRESS BUSINESS WRITER
The timing couldn't be worse.
Within the next two to four weeks, 316 Kmart stores nationwide, including 11 in Michigan, will close as part of the Troy retailer's bankruptcy restructuring.
The cost-cutting move will send about 32,000 workers -- 1,900 in Michigan -- out to find new work at a time when jobs are growing more scarce.
With worries about a looming war in Iraq, the economy slumping and unemployment rising, help wanted signs in store windows are uncommon.
In 2002, there were 19,000 fewer retail jobs in Michigan than in the year before. The 2.3-percent decline from 839,100 retail jobs in 2001 to 819,800 in 2002 marked the biggest drop of any industry segment in the state last year, said Bruce Weaver, a spokesman for the Michigan Department of Career Development.
And overall unemployment in Michigan doesn't look much better. In 2002, the annual average unemployment rate was 6.2 percent versus 5.3 percent in 2001 and 3.5 percent in 2000.
The clock is ticking
None of this bodes well for shell-shocked Kmart store employees finishing their last days of work in the liquidating stores. Exact store closing dates haven't been disclosed. Kmart officials say most will shut their doors for good by mid-April.
"It's going to be rough," said Comerica Bank chief economist David Littmann. "We're in a very difficult period for employers."
The big factor hampering hiring plans is the threat of war in Iraq, Littmann said.
"No employer is going to be hiring in advance of knowing the outcome of this uncertainty," he said. But he said it should take only about two weeks after the start of a war for the hiring climate to improve.
So what are soon-to-be-unemployed Kmart associates to do in the meantime?
"Prepare a resume and get some prospects in order," Littmann said. "Don't despair. You've got benefits and a cushion. Intensify your search to find a better competitor" to work for.
Littmann suggests workers look to growing companies like Wal-Mart Stores Inc. and Costco Wholesale Corp. or alternative retailers who sell by phone, catalog or e-mail.
Aside from unemployment benefits and extended medical and dental coverage under COBRA -- a federal law that allows laid-off workers to pay for continued health care coverage -- Kmart workers with the company at least one year will be paid for their unused vacation and sick time on a prorated basis, said Kmart spokesman Stephen Pagnani.
Each store also has a human resources representative available to help workers with resumes and job-searching tips. Some Kmart stores have welcomed hiring representatives from other retailers such as CVS Corp. or Home Depot into stores to help place workers.
Job-hunting plans
The Free Press set out to talk to Kmart store employees about their job-hunting plans. Here's what three have in mind:
Sticking with it: Ingrid Friedman of Novi can hardly talk about losing her job at the Big Kmart on Telegraph Road in Southfield without filling up with tears.
"I've been here 28 years," said the pharmacy technician shaking her head as she folded T-shirts on a recent Wednesday. "It was a good company."
For Friedman, finding new work is a necessity.
"My husband just retired. I had the medical and I've lost all of that. Now we're both looking for work," she said.
So after visiting a number of local pharmacies only to hear few are hiring, Friedman is planning to apply for work at another Kmart store.
"Things are tight out there. It hasn't been easy. I've decided I want to go to another Kmart store," Friedman said, acknowledging there is uncertainty surrounding the bankrupt company.
But by switching stores, Friedman can transfer her seniority and benefits.
Now she just waits for her Kmart application to be approved.
"I'm very flexible," she said, adding that aside from her pharmacy experience, she has skills dealing with paperwork, ordering and customer service.
The optimist: Tina Williams hears it all the time.
"My husband keeps telling me the jobs are not out there like they used to be. But I just don't believe it," said Williams, who will lose her job at the Detroit Super K on 7 Mile Road in a matter of weeks. She has been with the retailer for five years.
"I've been working since I was 14 so it's hard for me to believe I won't find a job. I'm very determined."
The Detroiter plans to collect unemployment for a month or two and then begin a serious search.
"I've worked in cash offices and I have accounting skills," said the mother of two. "Maybe I'll look into medical billing."
Williams says she feels fortunate that her husband has a stable job with an auto supplier.
However, she'd still like to find full- or part-time work to help pay for the little extras around the house.
"I've got a teenage daughter and her clothes are more expensive. That comes from my check," she said.
Without wheels: Mike Schwartz had hoped to work at the Sterling Heights Super K on Van Dyke Road for a number of years.
Because his 1995 Ford Mustang isn't running, having a job within walking distance from his Warren home was crucial.
But after just four months on the job, he got the bad news the store was shutting its doors.
"I could have left before the closing, but I've learned a lot here," said the 19-year-old. New skills include operating a high-low, learning about different departments including sporting goods and garden and observing firsthand how a liquidation sale is conducted.
Schwartz isn't sure what he'll do next. Maybe a job waiting tables or working retail elsewhere, he said.
The aspiring artist hopes to find a job and save enough money to enroll in Macomb Community College in the fall to build his grade point average and maybe later apply at the College for Creative Studies in Detroit. But first things first.
"I have to get my car fixed," Schwartz said.
Contact JENNIFER BOTT at 248-591-5626 or bott@freepress.com.
Here’s the chart that accompanied the article online. The numbers for 2003 are current. That’s right, Kmart shoppers - those numbers have already happened in 2003. About 2 dozen of those jobs, including the cushy executroid and bored-weasel positions, account for almost $50 million of that ‘expected cost’, and probably half of that in the ‘expected savings’ for the rest of the year. Can you say, ‘double-dipping’? I knew you could...
Kmart numbers In 2003
316 Store closings
44 Number of states
32,000 Jobs cut
11 Stores closing in Michigan
1,900 Jobs cut in Michigan
259 Discount stores closing
57 Supercenters closing
$1.7 billion Expected cost of closings
$500 million Expected savings in 2003
1,513 Stores remaining
92 Stores remaining in Michigan
168,000 Jobs remaining
9,600 Jobs remaining in Michigan
Last round (2002)
283 Stores closed in
40 Number of states and Puerto Rico
22,000 Approximate number of jobs cut
18 Stores closed in Michigan
1,470 jobs cut in Michigan
271 Discount stores closed
12 Supercenters closed
Much, much more of this to be discussed in the future here at the Funny Farm. Stay tuned to this website for further details…
