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PLEASANTON, Calif. - No. 3 U.S. supermarket retailer Safeway on Tuesday announced it is eliminating 940 of the approximately 7,000 positions in its administrative offices in an effort to cut expenses. About half of these positions will be eliminated from corporate offices in California and Arizona. The other half will come from retail division administrative offices across the U.S. and Canada.
Safeway handed out pink slips to 416 workers Tuesday, spokesman Brian Dowling told the Associated Press. Some 272 employees will be let go during the next year. Safeway is making the rest of the cuts by leaving 252 vacant jobs unfilled.
"Because of a prolonged economic downturn and a difficult operating environment, we need to lower our cost of doing business," said chairman, president and CEO Steve Burd. "Accordingly, we have taken this painful but necessary step of reducing our administrative office expenses."
Burd added that the cuts would not affect any Safeway retail store employees.
Each employee whose position has been eliminated will receive severance allowances and extended group healthcare benefits, the company said.
Safeway Inc., a Fortune 50 company, operates 1,694 stores in the United States and Canada and had annual sales from continuing operations of $32.4 billion in 2002.