Rebranding efforts always sound exciting in theory, but the restructuring processes that occur as a result are rarely as pleasant. Coffee giant Starbucks is turning to layoffs once more, grinding down on 900 jobs as a result of store shutdowns. Over the course of the last year, under the tutelage of CEO Brian Niccol, Starbucks has set sail on a mission to revive the company’s standing in the marketplace by increasing the hospitality of its operations.
Considering that increasing foot traffic at existing stores has been the central goal, Starbucks’ store closures are a surprising deviation from the strategy. Unfortunately for employees, many service jobs are now being affected by the changes to come.
Starbucks layoffs have been reported, with 900 service jobs on the chopping block as the business shuts down stores at unprofitable locations. (Image: Pexels)
Starbucks Layoffs Announced, with 900 Employees at Risk of Losing Their Jobs
The Starbucks job cuts are part of the company’s $1 billion restructuring effort, aimed at eliminating unproductive parts of the business to channel the freed-up resources into more successful areas. The majority of the changes that have been made at the company this year have focused on making the Starbucks stores more hospitable for customers to spend time at.
From redecorating interiors to introducing more seating space, the organization has set its sights on encouraging customers to spend more time at Starbucks, but not all of its stores have shown equal opportunities for improvement.
In a letter to employees, Niccol said as much to employees, “During the review, we identified coffeehouses where we’re unable to create the physical environment our customers and partners expect, or where we don’t see a path to financial performance, and these locations will be closed.”
What We Know About the Starbucks Restructuring Plan
The Starbucks layoffs will affect 900 employees in non-retail roles across North America. The company has been at the center of considerable conflict in relation to its baristas, with its updated dress code and reluctance to submit to union negotiations being two key issues.
Employees who are set to be affected by the Starbucks job cuts are set to receive notices of the change this week. Some employees may be relocated to other stores, but the company will otherwise provide “comprehensive severance” pay to those affected.
The company also indicated that many open positions will now be closed, which adds more weight to the rumors of a hiring slowdown that have been rising in the job market.
Starbucks Store Shutdowns Lead to Layoffs, Not Concerns Surrounding Performance
The exact number of Starbucks store closures has not been revealed, but they may add up to around 1% of the total number of locations across North America. The company reportedly had 18,734 stores in North America, and it hopes to end its 2025 fiscal year with 18,300 locations. CEO Niccol explained that Starbucks’ store closures were a common part of the business proceedings, however, the impact would be more significant this time around.
“Each year, we open and close coffeehouses for a variety of reasons, from financial performance to lease expirations. This is a more significant action that we understand will impact partners and customers. Our coffeehouses are centers of the community, and closing any location is difficult,” he explained.
The Era of Layoffs Claims More Victims
A period of change for the business inevitably means change for employees, however, layoffs are one of the more distressing outcomes of such evolution. Turning around Starbucks’ declining performance numbers is not an easy task, and unfortunately for employees, not everyone gets to join along for the rest of the journey. While Starbucks focuses on remodeling multiple locations and introducing a more cozy atmosphere to its stores, it’s quite apparent that employees don’t feel as warmly about the decisions being made at the top.
The company has made repeated commitments to its green apron workers as a part of its turnaround strategy, but there is unrest to be seen among their ranks. A fresh coat of paint can often fail to disguise such resentment when it comes to customer service roles, making it important for Starbucks and other businesses in similar positions to work harder on improving employee satisfaction and building engagement.
Baristas have also complained about the changing menus and the introduction of overly complicated drinks, which suggests a disconnect between the decisions being made and the information and training trickling down to workers. The resolution of these problems could help Starbucks cut down on the friction with employees and aid in their ability to serve customers, both of which are critical for the business to find its stride again.
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