Nike to Reduce Workforce by 5 Percent

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With low consumer spending and slumping sales, Nike Inc. has recently announced 5 percent workforce reduction that will affect more than 1,750 employees from its different facilities worldwide.

Meanwhile, the company has already adopted different cost-cutting measures to cushion the impact of recession.

Nike Inc. recently announced its plan to reduce its global workforce by 5 percent which is higher compared to the initial decision in February when company officials said the layoff will affect 4 percent of workers.

According to the sports-gear brand, the massive workforce reduction will affect more than 1,750 employees. The company officials also said that layoff will be completed from the next few weeks.

In a statement, Nike chief executive Mark Parker said the decision to implement workforce reduction has been difficult but said such move is necessary to pave way for continued growth.

Because of the weak economy, the company has previously shut down several factories and facilities in Vietnam and China and has restructured its business and divided this into several geographical groups in line with its cost-cutting measure.

While its rivals Puma and Adidas have posted weak demand and slumping sales for the past quarters, Nike has struggled to prevent massive losses. By simplifying its worldwide supply chains and restructuring its management, the company has maintained relatively healthy sales compared to its rivals.

Meanwhile, its shares have declined by almost 25 percent since last year as consumer spending remains weak.

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Nike to Reduce Workforce by 5 Percent

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