McDonald’s, a fast food chain that has brought in solid sales in recent years, became the latest corporate behemoth to engage in layoffs this week, according to a Wall Street Journal report. McDonald’s layoffs follow a string of staff cuts in tech, media, and finance at companies like Meta, Google, and Amazon, even as the broader labor market has remained strong.
Layoffs at big businesses are occurring during an odd time for the economy. While unemployment has stayed low, there’s still uncertainty about whether a recession will arrive in the months to come, and what impact the Federal Reserve’s interest rate hikes could have on the economy moving forward. Additionally, consumer spending, while solid, has slowed slightly, and could be another factor McDonald’s and others are concerned about.
“This highlights the unusual economic situation we’re in where consumer spending remains resilient enough to support business growth and hiring for front-line workers, but fears of recession are leading to cuts for office jobs,” said Glassdoor’s lead economist, Daniel Zhao.
The McDonald’s layoffs — which are expected to focus on corporate employees — appear to be driven heavily by the company’s own business decisions and interest in expansion. Earlier this year, McDonald’s CEO Chris Kempczinski announced that the company would cut staff as it invests more in growing and opening new locations in the US and Europe.
McDonald’s hasn’t expanded much in the US in the last decade, something the restaurant company intends to change as it also works on innovations, like an order-ahead drive-through system, to reach more customers. The staffing cuts, it seems, are aimed at trimming and consolidating teams that don’t focus on such priorities.
“It sounds like they want to reorganize the company into different structures to grow faster,” BTIG LLC analyst Peter Saleh told Bloomberg in January. “Maybe they feel like they don’t have the right…
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