Richmond-based Circuit City Stores Inc. announced Wednesday that it would fire 3,400 employees — including nearly 140 in the Washington area — and replace them with workers who will make less money. The company has more than 42,000 employees.
“We are taking a number of aggressive actions to improve our cost and expense structure, which will better position us for improved and sustainable returns in today’s marketplace,” Circuit City Chairman and Chief Executive Officer Philip Schoonover said in a statement. “We expect to deliver improvements in our selling, general and administrative expense rate while maintaining appropriate investments to drive our key strategic initiatives such as digital home services, multichannel and home entertainment.”
The job losses — which the company said took place Wednesday — are spread over 19 area stores. The company would not specify which stores were affected, or when new, cheaper workers would be brought on board, according to reports.
The company also announced it had reached an agreement to outsource its information technologies to IBM. Shares of Circuit City were up 51 cents, or 2.7 percent, to $19.43 following the announcement.
