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Walmart will lay off hundreds of corporate workers, require others to relocate

Jaclyn Peiser, Taylor Telford
Washington Post

Walmart will lay off hundreds of corporate staff and require the majority of employees working remotely or at a handful of off-site offices to relocate, the company announced Tuesday.

Walmart is the largest employer in the country, with 1.6 million workers. The majority of employees work in stores or warehouses. Chief people officer Donna Morris said in an email to staff that the number of associates beinglaid off is “small in percentage” relativeto the size of the company.

The retail giant mandated that the majority of employees in Dallas, Atlanta and Toronto move to its headquarters in Bentonville, Ark. Other staffers will go to locations in the San Francisco Bay Area or the New York metropolitan area. Employees affected by the news have already been notified, the company said.

“We believe that being together, in person, makes us better and helps us to collaborate, innovate and move even faster,” Morris said in the email. “We also believe it helps strengthen our culture as well as grow and develop our associates.”

Walmart has been investing in enhancing its in-person office experience, particularly at its headquarters known as Home Office. The company began new construction on a 350-acre campus in 2019 and aims to open in phases through 2025. The new campus has a child care center, hotel, 360,000-square-foot health and fitness center, food hall, 37-mile walking and biking trail, and auditorium.

The company, which reports its first-quarter earnings on Thursday, has been cutting costs recently. Last month, it announced it was shuttering Walmart Health, an initiative started in 2019 that offered in-person health clinics at 51 stores as well as virtual visits. The company, which last year said it planned to open two dozen more, said it “determined there is not a sustainable business model for us to continue.”

Walmart follows several other large companies in asking white-collarworkers to relocate as part of a push for more in-person work. The move comes amid a national stalemate over the return to offices: The effort to get workers back together in person has been ongoing since 2021, and scores of knowledge workers have long since made the transition. Yet office occupancy has hovered stubbornly around 50 percent of pre-pandemic levels across the country’s top metro areas since early 2023, according to data tracked by Kastle Systems.

As the labor market has cooled and layoffs have risen, more leaders have used their leverage to push for a greater return to offices. But workers have been reluctant to give up the flexibility they gained during the pandemic, and they’ve shown their resistance through petitions against RTO, leaving the company and even filing lawsuits.

Since the pandemic waned, hybrid work has become the dominant model for knowledge workers, with 54 percent of remote-capable workers operating under hybrid schedules, according to data from Gallup.

Executives have extolled the value of in-person work since the onset of return to offices, citing benefits to company culture, productivity and collaboration. CEOs such as Tesla’s Elon Musk, Meta’s Mark Zuckerberg and Nike’s John Donahoe have criticized remote work for leading to drop-offs in innovation and productivity. But they’ve provided little hard evidence for these claims, and are probably relying on decades-old research about the importance of co-location of teams, according to Christopher Myers, an associate professor of management and organization health at Johns Hopkins University.

Older research about the benefits of co-location for innovation tends to focus on examples of “things that came about because two people who happened to be near each other started talking about a problem they were having,” such as Post-it notes and Gorilla Glue, said Myers, who is also a scholar with the Academy of Management. But that’s far less applicable in today’s landscape, where technology allows workers to connect far more easily when they’re not in the same place.

“We have more options other than face-to-face interaction now,” Myers said. “Relying on that old research and that old perspective may not be as relevant or helpful.”