All across the nation, paid union activists have been protesting to get states to raise their minimum wage to $15 per hour, and in at least two states they’ve been successful. However, such things don’t come without consequence, and after New York and California raised the minimum wages, Sears Holding Company delivered devastating news to those protesting.
On Thursday, the company released a statement that it’s going to be shutting down 68 Kmart stores and another 10 Sears stores across the country, and Edward S. Lampert, chairman and chief executive officer, cited higher minimum wages as the cause, the Democrat & Chronicle reported.
“The decision to close stores is a difficult but necessary step as we take aggressive actions to strengthen our company, fund our transformation and restore Sears Holdings to profitability,” Lampert said in a statement. “We’re focusing on our best members, our best categories and our best stores as we work to accelerate our transformation.”
Along with the increases in minimum wage, Lampert said online competition has been hurting the company. Last year, the company’s profits went from $8.1 billion down to $7.3 billion, and with rising wage costs and increased competition, Lampert said the company had no choice but to shut the doors on dozens of stores.
However, he also said the company will do its best to try to accommodate those affected.
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Sears said affected workers would have an opportunity to apply for open positions at other area stores. Some displaced employees will receive severance packages, the company said.
The stores slated to close will begin liquidation sales later this month.
“We are committed to treating these associates with respect and compassion during this process,” Lampert said.