CVS Health is laying off nearly 3,000 employees as the company deals with a potential strike by union workers throughout California.
3. CVS Workers Authorize Strike as Company Lays Off Nearly 3,000 Employees
News from CVS made waves this week as the company deals with an impending strike by union workers in California. Members of UFCW union locals representing thousands of CVS Pharmacy workers throughout California have voted overwhelmingly in favor of authorizing their bargaining team to call for an unfair labor practice strike, should one be necessary.
“When we started negotiating with CVS on a new contract in May, we came to the table willing to put in the time and work to get it done,” noted the UFCW CVS Bargaining Team in a statement released Sept. 27. “But instead of working with us towards a reasonable contract, our employer would rather disrespect us to our faces, offer proposals that grossly underestimate our value and their wealth, and engage in multiple labor violations.”
The next bargaining session is scheduled for Oct. 16.
In other CVS news this week, it came to light that the company will eliminate about 2,900 jobs in a bid to lower costs. 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.
“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.”
4. Port Strike Poised to Bring Supply Chain Issues
The anticipated strike by the International Longshoremen's Association began this week as the group announced that it closed ports along the Atlantic and Gulf Coasts, as of 12:01 a.m. Oct. 1. Those 36 ports handle 57% of the container volume in the Unitee States.
Port workers walked off their jobs and set up picket lines in various port facilities after the union rejected the final offer made by the United States Maritime Alliance (USMX). More than 85,000 waterside employees belong to the union.
The USMX, for its part, stressed that it had upped its wage increase offer to more than 50% over the proposed contract that extends over six years.
“A port strike would paralyze U.S. trade and raise prices at a time when consumers and businesses are starting to feel relief from inflation,” observed Erin McLaughlin, senior economist at The Conference Board. “There’s no easy Plan B. While shippers have already begun diverting some cargo to the West Coast, capacity for such alternative options are limited.”
While the Biden Administration could step in and invoke the Taft-Hartley Act to temporarily block the strike, the White House indicated that it did not plan to take that step at this time. That said, the National Retail Federation called on the White House to reevaluate that stance.
5. Behind Target’s Private Label Strategy
Target’s Good & Gather line, which is marking its fifth anniversary this fall, has become a flagship brand for the retailer and reflects its focus on and success in food and beverage over the last few years.
PG spoke exclusively with John Conlin, SVP of merchandising, food and beverage at Target, this week about the $4 billion portfolio that has become such a stalwart that more than 40% of all Target grocery runs now include at least one Good & Gather item.
“I’m really proud of what the team has accomplished over the last five years. We introduced Good & Gather in September 2019 for consumers who wanted convenient, high-quality food options that tasted great and were also affordable,” said Conlin. “And since launching, Good & Gather has become Target’s largest owned food and beverage brand, with over 2,500 products, more than half of which are priced under $5.”
Continued Conlin: “The brand is resonating with consumers because we are constantly evaluating our entire assortment to deliver a portfolio of great items our shoppers want. We consistently seek feedback from consumers to make our brands stronger and more preferred.”
In other popular Target news this week, the retailer revealed that it is adding new locations across nine states this month. Those new stores are located across California, Delaware, Florida, Hawaii, Iowa, New York, North Carolina and Tennessee, and are part of the retailer’s investment in its stores-as-hubs model for both shopping and order fulfillment.