The University of Guelph has an expert who can comment on the closing of 34 Lowes stores across Canada and what it might mean for store employees.
Prof. Nita Chhinzer is a professor of human resources in the Department of Management in U of G’s Gordon S. Lang School of Business and Economics. Her current research focuses on downsizing practices, procedures and ethics.
Research she recently completed with colleague Prof. Agnes Zdaniuk examined the tone and messenger of downsizing announcements and how shareholders react to the news. That research found that when companies can explain the job losses as unavoidable because of forces outside their control, the market tends to respond positively. But when they attempt to justify the cuts as a means to prevent future losses, shareholders are less forgiving.
While Lowes’ announcement does not address layoffs, Chhinzer notes the store closings will almost surely lead to job cuts, since not all staff can be relocated. The timing of the announcement is interesting as well, she added, given how close it comes to the holiday season and that the company’s CEO retired only last month.
She also notes that many retailers, including those supplying the home renovation market, have struggled in recent years as many consumers shift to online shopping.
Prof. Nita Chhinzer