The Starbucks Corporation has announced that it plans to close a total of 600 stores in the United States. The coffee store chain will also be cutting back the number of new stores set to open in 2009 from 250 to 200.
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The company claims that the closures are due to underperforming stores located in areas affected by the housing crisis. The stores that are subject to being shut down are allegedly not returning a profit or at risk of not returning a profit as economic conditions continue to deteriorate.
Starbucks CEO Howard Schultz stated: “This makes our decision to close stores difficult because it is disrupting the lives of the people who have worked so hard to deliver superior service to our customers. At the same time, we recognize that it is necessary to make a decision that will strengthen the U.S. store portfolio.” (BBC News, 2008)
While CEO Schultz claims to care about the impact that the closure of 600 stores will have on thousands of workers, he has made it clear that profits come first. Starbucks is a multi-billion dollar corporation that took in over $9 billion in revenue and $673 million in profits in 2007. Schultz is a billionaire who receives an annual salary of nearly $5 million a year. In contrast, the starting wage for a barista in New York City is $8.75 an hour.
A court ruling against Starbucks earlier this year made evident how much the company cares for its employees. A judge ordered Starbucks to pay baristas in California over $100 million in back tips and interest. The company had been taking a cut from tips to baristas to supplement the pay of shift supervisors at no cost to itself.
The working class is always hit hardest by the economic crises created by capitalism. As the economic tide turns, the capitalists are quick to discard workers as if they were nothing but used commodities in order to continue reaping massive profits.
