Swedish fashion retailer H&M has announced a plan to close down more than a fifth of its stores and lay off as many as 588 workers in Spain, home of its bigger rival, Zara owner Inditex, local unions said.
The corporation has announced layoffs for reasons that are not clear-cut in terms of organisational, productive, or financial ones, according to a joint statement from unions CCOO and UGT.
According to H&M’s annual report, the firm stated that it employs approximately 4,000 people in Spain and has 133 locations. The business announced its plans to close 28 locations in a statement provided.
H&M declared that maintaining its competitiveness and strategically placing its stores were top priorities, and that it was “consistently” assessing its portfolio of stores.
“This involves … enhancing the shopping experience in our existing stores, actively seeking out new opportunities and making informed decisions about closing stores when necessary,” it said, without providing further details on why it decided to close the stores.
This action is consistent with other major global fashion retailers who have closed smaller locations in recent years in favour of growing flagship locations that attract higher traffic and serve as e-commerce logistics hubs.
Union sources claim that H&M in Spain has also experienced issues with employee absenteeism and complaints about job overload. H&M revealed a global strategy to reduce 1,500 employment in November 2022 in order to save expenses. In 2021, it had already cut 400 employees from its workforce in Spain.
“We believe the measure is too aggressive and it is possible to look for solutions which don’t imply job losses,” the unions said. Negotiations with the unions in Spain are due to start in September. H&M said it had already informed the union and that it would work closely with it.
