Levi Strauss Announces Corporate Workplace Cuts Of 10%-15%

San Francisco based jeans and clothing company Levi Strauss announced on Thursday that between 10% and 15% of their workforce will be laid off in the first half of 2024, becoming the latest Bay Area company to announce layoffs this year.

San Francisco and the Bay Area, still reeling after tens of thousands of job cuts in 2022 and 2023 respectively, looked forward to a better 2024, with less jobs cuts, a better economy, and new growth industries such as AI helping revitalize the area. However, less than a month into the new year, and 2024 is currently on pace to be just as bad as previous years in the Bay area. Multiple tech companies have already announced the firings of thousands of employees, with some companies getting rid of close to 2,000 employees in a single day. While many hoped that the layoffs would just affect the tech sector, those hopes were dashed on Thursday when Levi Strauss announced huge employee cuts of between 10%-15% of the workforce.

While final figures were not announced, it is known that the company has roughly 19,000 employees. Cuts of 10-15% would mean that between 1,900 to 2,850 employees, mostly in and around the San Francisco headquarters, could be lost. With Macy’s, Wayfair, Walmart, and other retail companies announcing layoffs and closures in recent weeks because of a weakening retail market, Levi’s following the same excuses. In particular, they announced that restructuring would be taking place following lower than expected sales in 2024. Projected revenues of 4.7% are instead down to 1-3% for the year.

“The first phase of the global productivity initiative is expected to occur in the first half of 2024 and is expected to include a 10% to 15% reduction of our global corporate workforce,” Levi’s CFO Harmit Singth said in the Levi’s quarterly report issued on Thursday. “As a result, the Company expects to record estimated restructuring charges of $110 to $120 million in the first quarter. Additional restructuring charges may be incurred as the company progresses further with this initiative.”

“We achieved a strong Q4 performance, inflecting to growth along with substantial margin expansion, generation of positive free cash flow and closing the year with record net store openings. Looking forward, we are focused on margin execution supported by gross margin expansion and by our global productivity initiative, which gives us clear line of sight to significant annual cost savings.”

While Levi’s avoided the usual “crime and failing city” reasons for the cuts, the layoffs will nonetheless have a huge impact in the city. In particular, the cuts can be political fodder for races this year.

“Levi’s is one of the most San Francisco companies out there, ” said Julie Ochs, a San Jose-based headhunter and hiring specialist, to the Globe on Thursday. “You can argue it is THE most San Francisco-tinged company in the city. The 49ers stadium is sponsored by the company. So them losing thousands of employees? You can bet the San Francisco [political] races will have this as a talking point. Especially in the Mayoral race, where a Levi Strauss heir, Daniel Lurie, is running. He may not be too closely tied with the company, but you better believe that all his opponents will use this against him.”

“I’m expecting a lot of former employees to come knocking soon for job help, because it is still very tough in San Francisco.”

More Bay Area layoffs are expected to be announced soon.