Nike says it will eliminate 745 jobs in Oregon by the end of September, quantifying for the first time how the broad restructuring announced in June will affect its home base.
That means just over half the layoffs planned by the company will take place at its corporate headquarters in Washington County.
In a letter to state officials, the company reiterated that the downsizing is connected to its new business initiative — dubbed the Consumer Direct Offense — which it hopes will provide a badly needed spark.
“In June 2017, we announced that we will be shifting to the Consumer Direct Offense, a new company alignment that allows Nike to better serve the consumer personally, at scale,” wrote Marc Bohn, a Nike vice president, in a letter to the state. “As part of that restructuring, Nike undertook workforce reductions in July and is now implementing an additional round of workforce separations.”
The company declined to offer additional details, other than to say it is “putting decision-making closer to the consumer so we can move at the speed of the marketplace.”
The athletic shoe industry foresees a digitally enabled era when highly automated manufacturing will allow it to quickly fulfill nearly custom orders from consumers. That day is still a ways off. But in an era when athletic footwear retailers are struggling and some going out of business, the big brands are frantically building their direct-to-consumer operations.
Angry former employees say the downsizing had less to do with Nike’s new business strategy and more to do with jettisoning well-paid, veteran employees. Some workers asserted on social media that older workers took the brunt of the layoffs.
“Those laid off in my department all had at least 10 years and were on the higher salary range,” one former employee posted last week on TheLayoff.com website. “The fact that it was a strictly numbers move makes it easier to take but makes me despise the company even more.”
Nike divulged earlier this summer that it would eliminate 2 percent of its workforce worldwide, which works out to about 1,400 jobs altogether. Though it remains the dominant force in the athletic footwear and apparel industry, Nike is enduring a rare slump, losing market share and momentum.
The company gave 255 the ax in July and said another 490 will be “separated” this month.
Nike is the largest company headquartered in Oregon. Before the layoffs it employed 74,000 in 53 countries, including about 12,000 at its Oregon headquarters.
The company reported $34.3 billion in sales during its last fiscal year, along with $4.2 billion in profits.
Nike promised the state in 2012 it would create 500 jobs if lawmakers passed legislation locking in a favorable corporate tax structure for 30 years. Then-Gov. John Kitzhaber called legislators into a two-day special session and promptly did the company’s bidding.
Nike far exceeded that promise. Bohn said the company has created about 3,800 jobs in Oregon in the past five years.
The cuts are the latest in a string of layoffs in Washington County, including last year’s cuts at Intel, plus more recent cutbacks at SolarWorld and SureID. Overall, Oregon’s job market remains tight with unemployment near historic lows.