Walmart Cutting 7,000 Back-Office Jobs, Shifting Workers To Customer Service

VALLEY STREAM, NY - MARCH 29: A man pushes carriages outside of a Walmart store on March 29, 2011 in Valley Stream, New York. The U.S. Supreme Court heard arguments Tuesday on whether more than one million female Walmart employees can pursue a class-action discrimination suit against the retailer. The group of women says Wal-Mart systematically discriminated against women in stores across America. (Photo by Spencer Platt/Getty Images)

The nation’s largest retailer wants its employees interacting with customers and not doing the books.

VALLEY STREAM, NY - MARCH 29: A man pushes carriages outside of a Walmart store on March 29, 2011 in Valley Stream, New York. The U.S. Supreme Court heard arguments Tuesday on whether more than one million female Walmart employees can pursue a class-action discrimination suit against the retailer. The group of women says Wal-Mart systematically discriminated against women in stores across America.  (Photo by Spencer Platt/Getty Images)
VALLEY STREAM, NY – MARCH 29: A man pushes carriages outside of a Walmart store on March 29, 2011 in Valley Stream, New York. The U.S. Supreme Court heard arguments Tuesday on whether more than one million female Walmart employees can pursue a class-action discrimination suit against the retailer. The group of women says Wal-Mart systematically discriminated against women in stores across America. (Photo by Spencer Platt/Getty Images)

As a result, Walmart is eliminating about 7,000 store-based office jobs all over the country.

The Wall Street Journal reported that the change comes as Walmart tries to adapt to significant trends changing the retail industry, including keeping inventories down and dealing with increased employee wages.

Training and wage increase programs at Walmart have cost the company $2.7 billion for its 1.5 million workers.

“Anytime one expense line goes up, you are likely to see a reduction in a corresponding expense line,” said Joel Bines, co-head of consulting firm AlixPartners LLP’s retail practice.

In today’s environment, “any dollar not being spent on delivering a better experience to the customer or delivering the customer online is a wasted dollar,” he said.


Walmart said that employees losing back-office jobs in accounting and invoicing will be able to transition into jobs that directly interact with customers. The company indicated that two to three positions would be involved at an average store.

However, Making Change at Walmart, a campaign backed by the United Food & Commercial Workers International Union, said employees will come out the losers because the jobs being eliminated pay higher wages than the ones to which current back-office employees might transition.

“This Labor Day, Walmart has decided to rollback jobs instead of their prices,” Jess Levin, communications director for the group, said in a statement. “While this holiday weekend should be about celebrating America’s hard workers, sadly these Walmart employees will instead be worrying about their next paycheck.”

“These back office jobs were some of the better positions at Walmart. They could come with a higher salary, and also allowed a worker to be at a desk as opposed to on their feet all day,” she said.

“This change, no matter what Walmart promises, will most likely put 7,000 workers in the position of having to choose between a pay cut or no job at all. Walmart continues to show the world that their claim of investing in workers’ training, development, and wages was not meant for all workers. Clearly, this is how Walmart intends to pay for that investment: by firing associates and cutting jobs,” Levin said.”

Deisha Barnett, a Walmart spokeswoman, said that in the pilot project to test the changes, some employees got raises and others took lower wages. She said the pilot project was successful for the 500 stores that tested it.

Currently, the targeted employees at Walmart’s 4,600 stores manage a store’s daily cash flow or process claims from vendors. Next year, some of the work will be done by a central office.

Walmart also installed money-counting “cash recycler” machines in 500 stores as a test, and is expected to roll them out nationwide next year to replace the employees whose jobs will be cut.

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