JC Penney's new CEO Ron Johnson is in the process of restructuring this iconic American department store. But what does this mean for employees of the company? In April, this meant widespread layoffs. And now, JC Penney has announced the elimination of commissioned sales jobs at departments around the country. As JCP restructures, the company is divesting from their workforce by eliminating family-sustaining commission retail jobs.
JC Penney is following an alarming and misguided trend in the retail industry, in which middle class jobs and career opportunities are sacrificed in the name of short-term cost savings. By terminating commissioned sales positions, the company is jeopardizing the quality of customer service and divesting from its workforce.
JC Penney's shareholders and management team should look at Circuit City’s example to see that cutting staffing and commissions are the wrong kinds of cuts to save money. When Circuit City was in dire straits, they chose to cut commissions and lay off experienced, successful and well paid workers. Those results were disastrous, and it led to them going out of business completely. JC Penney should learn from the downsizing and cost-cutting strategy implemented by Circuit City that ultimately led a decrease in employee morale and customer service, and ultimately to their bankruptcy.
JC Penney's shareholders and investors need to tell their new CEO that instead of laying workers off and eliminating the best sales positions available in one of the leading job growth industries in the country, JC Penney should invest in their workforce and preserve jobs that will sustain families.