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Nike To Lay Off 1600 After Woke Drama, Stock Dip

Sportswear giant Nike announced on Thursday, February 15, that it has decided to lay off about 2% of its workforce, about 1,600 people. The announcement was made in a Thursday night email sent to the company by Nike President and CEO John Donahoe, who also announced that the layoffs were to begin the next morning.

As background, Nike is one of the biggest employers in the Pacific Northwest and is a global company with tens of thousands of employees worldwide. In the US, the company has about 15,500 workers in the Portland, Oregon, and Southwest Washington state area. Further, Nike has about 83,000 employees across the world.

Now, however, it is starting to lay off a large number of those employees. Explaining the necessity of layoffs in the email, obtained by WFAA, Donahoe said, “This is a painful reality and not one that I take lightly.” Donahoe continued, “We are not currently performing at our best, and I ultimately hold myself and my leadership team accountable.”

Continuing, Donahoe tried to remain somewhat upbeat despite the layoffs, saying, “Nike has a proud history where the most challenging moments bring out the best in us, individually and as a team. I know we will come together to respond once again, and I am confident in our future.”

The layoffs come amidst a large cost-cutting plan that Nike announced in December of 2023, when it said that it would cut about $2 billion in expenses over three years. That cost-cutting strategy aimed to, among other things, focus on tightening supply costs and reduce layers of management. According to Nike, included in the planned cost cuts are $400 million to $450 million in employee severance costs.

Jana Panafilio, an employee of Nike for nearly three decades, co-created a support group for other former Nike employees after she left the company, 6453 Alumni. She said

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, “We are here to support as a landing place for those people as they leave the brand to make their transition from Nike to next.” She added, “There is a disproportionate number of former Nike people that start their own companies. They are looking for talent, and they are looking for clients. So, depending on what it is they are looking to do or what kind of help that they need, we have the resources to help them.”

Further, Reuters noted that the cost-cutting layoffs came amidst a stock dip sparked by a negative outlook for Nike. Reporting on the stock dip, Reuters said, “Nike’s shares were down 4% after brokerage Oppenheimer downgraded the stock to “perform” and cut price target on concerns of “spotty consumer demand” over the next several quarters.

Similarly, Breitbart News noted that Nike is widely known as one of the most “woke” companies in America and globally. In its words, “Nike has been at the center of “woke” ideological drama multiple times in recent years, including the April 2023 signing of transgender TikToker Dylan Mulvaney to model sports bras and leggings.

Also, in the summer of 2021, Nike CEO Donahoe emphasized Nike’s commitment to the Chinese market, saying, “We are the largest sport brand there, and we are a brand of China and for China.” Continuing, Donahoe added“And the biggest asset we have in China is the consumer equity. Consumers feel a strong, deep connection to the NIKE, Jordan and Converse brands in China. And it’s real.

Featured image credit: By Ajay Suresh from New York, NY, USA – Nike Flagship – NYC, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=80043580

source:https://theamericantribune.com/

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