CVS Health Laying Off Nearly 3,000 Employees
CVS Health has revealed that it will eliminate about 2,900 jobs in a bid to lower costs, according to published reports.
“We’ve embarked on a multiyear initiative to deliver $2 billion in cost savings by reducing expenses and investing in technologies to enhance how we work,” a company representative noted in a statement cited by CNN. The layoffs account for under 1% of CVS Health’s workforce.
“Impacted positions are primarily corporate roles,” added the company representative. “The reductions will not impact front-line jobs in our stores, pharmacies and distribution centers.”
These latest job cuts are on top of the approximately 5,000 or so layoffs revealed last year. In 2021, CVS Health said that it would shutter around 900 stores between 2022 and 2024.
“Our industry faces continued disruption, regulatory pressures and evolving consumer needs and expectations,” the company representative said this week.
Meanwhile, citing “people familiar with the matter,” CNBC reported that CVS’ board has been conducting a strategic review of its business for some time as the company deals with potential activist pressure and a severely depressed stock price. The sources noted that there’s no certainty on what actions, if any, the company may take, but a breakup of the insurance and retail businesses is one option under consideration.
This past August, when CVS revealed its plan to slash $2 billion in expenses over the next several years, CEO Karen Lynch said that that company was pursuing growth while curbing costs in light of higher medical costs.
Fellow drug store chains Walgreens and Rite Aid have also recently revealed store closures. CNN has attributed the channel’s difficulties to falling reimbursement rates for prescription drugs, as well as consumer migration to online and big-box retailers to purchase snacks and household essentials that they once would have sought at the front end of drug stores.
With its CVS Pharmacy subsidiary, Woonsocket, R.I.-based CVS Health has 300,000-plus colleagues – including more than 40,000 physicians, pharmacists, nurses and nurse practitioners. The company is No. 5 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America. Deerfield, Ill.-based Walgreens and Philadelphia-based Rite-Aid are Nos. 6 and 26, respectively, on PG’s list.
