Made in the USA clothing brand, American Apparel has started laying off about 180 employees or 1.8% of its 10,000 employees, mostly in the manufacturing department, in order to streamline the company’s operations, The New York Times reported.
These layoffs reach almost every part of the production cycle in the country.
The brand’s CEO, Paula Schneider said in an interview Tuesday that the company has already started informing employees whether their jobs will be eliminated. All employees losing their jobs would be notified by April 3.
American Apparel issued unpaid furloughs to some employees — which were expected to end after the layoffs — while its sales plummeted and inventories continued to grow. It is unknown whether more layoffs are ahead, but Schneider said the retailer was continuing to assess its workforce. Some of these workers could be terminated, while others will return to their jobs.
Wages have not been reduced and Schneider said the company is committed to keeping its production at factories in downtown Los Angeles.
In its fourth quarter report, the company announced it suffered a net loss of $28 million, and as of Dec. 31, 2014 it was left with only $8.3 million in cash.
According to the New York Times, American Apparel is also in the process of overhauling its design department, which means letting go of some of the founder, Dov Charney’s closest creative appointees. Senior designer Merily Lupo, who was hired by Charney in 1999 at age 19, said she had been let go suddenly two weeks ago, along with two other longtime creative directors.
The company does, however, hope to grow its stores and did not plan on laying off retail workers.
