Fashion retailer H&M cuts 1500 jobs after profits tumble
High street fashion retailer H&M is to cut as many as 1,500 jobs from its global workforce as part of a major restructuring programme to slash costs after sales in Europe slide and profitability is squeezed.
The move comes after the Swedish clothing giant closed 56 stores in the UK since 2020 as it scales back operations in Europe.
The Stockholm-based business said the jobs losses were set to save around two billion Swedish Krona (£160 million), with the savings being realised in the second half of 2023.
Gross profits in the third quarter sunk almost 90% to £42 million. Sales in Western Europe slid 9% compared to 2021, while sales in Eastern Europe fell 22%, offset by growth in North America and Asia to produce a slight uptick in overall global turnover, suggesting that Europe was set to bear the brunt of the job losses.
H&M boss Helena Helmersson said: “The cost and efficiency programme that we have initiated involves reviewing our organisation and we are very mindful of the fact that colleagues will be affected by this.
“Long-term initiatives to meet customers’ ever-increasing expectations are continuing. In a situation of high inflation where household living costs are rising significantly it is more important than ever to offer customers the best value for money.”
As of November last year, the firm had 107,375 employees, of which about 10% were based in Sweden. H&M has 6,000 employees in the UK, according to its most recent filing with Companies House – down from the roughly 8,000 it employed in the UK prior to the start of the coronavirus pandemic.
An H&M spokesperson could not confirm how many jobs in the UK would be affected by the restructuring.