Sears, Roebuck & Co. said Thursday that it will close its regional distribution centers in East Los Angeles and Montebello, a move that could put nearly 2,000 employees out of work, including many who have been with the company more than 20 years.
The shutdowns are part of a companywide cost-cutting program expected to eliminate 33,000 jobs across the country by year-end.
In January, Sears will close its two buildings on East Olympic Boulevard, where the company handles orders for catalogue merchandise from customers on the West Coast. Sears’ nearby Boyle Heights store will not be affected.
In addition, the retailer by the end of March will shut its retail warehouse in East Los Angeles and another in Montebello that ship merchandise to all of its West Coast Sears stores.
There appears to be little hope that more than a handful of the 585 full-time workers and the 775 part-timers at the catalogue facilities will keep their jobs. Sears declined to discuss its plans for the employees, explaining that job transfers and severance benefits need to be negotiated with Teamsters Union Local 208, which represents most workers at the regional catalogue and retail warehouse centers.
Perry Chlan, a spokesman at Sears’ headquarters in Chicago, said the company “always tries to place people elsewhere if jobs exist, but things have been pretty tight.”
Sears officials said the work performed at the Los Angeles catalogue order-processing operation, one of the company’s six catalogue merchandise centers across the country, would be transferred to similar facilities in Dallas and Kansas City.
Tom Shaw, general manager of the Los Angeles catalogue merchandise center, said the facility is being shut because it is the most expensive that Sears operates. He said a big part of the problem is that the two catalogue merchandise buildings are about two blocks apart and goods often must be shipped by truck between them.
In addition, the Sears facilities are outdated. One of the catalogue warehouses, a 1.3-million-square-foot building at 2650 E. Olympic, opened in 1927. Shaw also cited local labor costs as a problem.
The job prospects for about 220 full-time workers and 390 part-timers at Sears’ retail warehouses are unclear but perhaps slightly more upbeat than at the catalogue operation. Chlan said that the West Coast retail warehouses will be relocated by March but that no decision has been made on the new site, including whether it would remain in Southern California.
Greg Roth, business agent for Teamsters Local 208, said he was hopeful that many of the current retail warehouse employees will keep their jobs if the operation stays in Southern California.
Most of the Sears employees at the catalogue operation were told of the company’s plans Tuesday, while workers at the retail warehouses were given the news two months ago. Chlan said Sears did not issue a statement until being contacted by a Times reporter Thursday because “details of the negotiations are not yet available. It would be an incomplete announcement.”
Roth estimated that at the two regional operations a total of 700 to 800 workers have been with Sears for 20 years or more. But given that it will be months before workers are expected to lose their jobs, Roth said many people “just haven’t come to grips with it yet. It hasn’t set in.”
At the same time he said that “a few people are resigned to it, having heard rumors for a year or so. Sears has been closing things everywhere.”
On the other hand, Shaw described employees as being upset by the news. “There’s some shock involved when you tell people, many of whom have been in the company a long time.”
The planned closings were called a major blow to the already distressed East Los Angeles area by Jack Kyser, chief economist for the nonprofit group Economic Development Corp. of Los Angeles County.
“A lot of people in East Los Angeles view that as a good source of jobs, and they’ll be very distressed,” Kyser said. He predicted that it would be difficult to find a major employer to replace Sears because of the age of some of its facilities and the poor truck access to the area.
In addition, Kyser said, the closings will hurt nearby restaurants and shops frequented by Sears employees.