The retail industry has begun shedding middle managers at an alarming rate. This trend follows a pattern first seen in the tech sector but has now firmly taken root in America’s largest retail operations. Walmart’s recent announcement of management restructuring signals a major shift that could affect thousands of workers nationwide.
Last month, Walmart revealed plans to eliminate several middle management positions across its U.S. stores. The company will remove roles like team leads in the deli, bakery, and some overnight operations. This marks the second round of cuts this year after February’s elimination of co-manager and coach positions affected roughly 2,000 employees.
“Companies are looking at their organizational structures and asking if they need all these layers,” says Michael Mandel, chief economist at the Progressive Policy Institute. “Retail has traditionally been very hierarchical, but technology is changing that equation dramatically.”
The move reflects a broader economic reality facing retailers. With profit margins under pressure from rising costs and online competition, companies are seeking efficiency through organizational restructuring. The Bureau of Labor Statistics reports that the retail sector has shed over 47,000 management positions since January 2023, representing a significant shift in how these businesses operate.
Walmart isn’t alone. Target, Macy’s, and REI have all announced similar cuts to middle management roles in recent months. These changes come as retailers invest heavily in automation and digital tools that allow fewer managers to oversee larger operations. Self-checkout systems, inventory management software, and automated scheduling have reduced the need for traditional supervisory roles.
For remaining managers, the workload has intensified. A store manager who requested anonymity due to fear of retaliation described how her responsibilities have doubled since recent cuts. “I now oversee departments that previously had dedicated leadership. The company expects the same results with fewer people making decisions.”
Retail industry analysts point to several factors driving this trend. Consumer spending patterns have become less predictable in the post-pandemic economy. According to the Federal Reserve’s latest Beige Book, retail sales growth has slowed across multiple regions, forcing companies to focus on operational efficiency rather than expansion.
The human cost of these changes extends beyond those losing jobs. Workers remaining after cuts often face increased responsibilities without corresponding pay increases. Labor unions representing retail workers have expressed concern about this “quiet loading” of additional duties onto existing staff.
“What we’re seeing is a fundamental restructuring of retail work,” explains Richard Benson-Armer, retail practice leader at McKinsey & Company. “Companies are pushing decision-making authority down to frontline workers while consolidating management. The middle layer is getting squeezed from both directions.”
This strategy mirrors what happened in the tech industry beginning in 2022, when companies like Meta, Amazon, and Google eliminated thousands of middle management positions. The tech sector labeled this the “great flattening” – reducing organizational layers to speed decision-making and cut costs.
For job seekers with retail management experience, the market has become increasingly competitive. LinkedIn data shows a 32% increase in applications for retail management positions compared to last year, while job postings have decreased by 17%. This mismatch has created significant challenges for displaced managers seeking comparable positions.
Some former retail managers have found success transitioning to logistics or e-commerce roles, where their operational experience remains valuable. Others have moved into consulting, helping smaller retailers navigate the changing landscape. Community colleges report increased enrollment in business technology programs among former retail managers seeking to enhance their digital skills.
Economic research suggests this trend may have long-term implications for wage growth and career advancement in retail. Historically, middle management positions provided a pathway to higher wages for workers who started in entry-level positions. With fewer of these roles available, the career ladder in retail appears to be missing several rungs.
The Federal Reserve Bank of Atlanta’s Wage Growth Tracker shows that wage growth for retail managers has fallen below the national average for the first time in five years. This suggests that even those retaining management positions are seeing less financial benefit than in previous years.
For consumers, these changes may be less visible but could affect shopping experiences. With fewer managers on the floor, customer service issues may take longer to resolve. However, retailers argue that technology enables more efficient operations that ultimately benefit customers through better inventory management and lower prices.
As the holiday shopping season approaches, retailers will face the first major test of these leaner management structures. Industry experts will be watching closely to see if the strategy delivers the promised efficiency gains or creates operational challenges during the busiest time of the year.
