May 17, 2024 - Business

How Nike's layoffs affect Beaverton's economy

An aerial view of a sprawling company campus with buildings and tennis courts.

Nike headquarters in Beaverton stretches across 400 acres. Photo: Courtesy of Nike

Mass layoffs at Nike — one of the largest employers in Oregon — are not new, but a significant loss of high-wage workers in the company's Washington County headquarters could lead to the local economy taking a hit, experts told Axios.

Catch-up quick: In February, Nike announced it would cut 2% of its workforce worldwide, including 740 employees at its Beaverton headquarters.

  • In its last earnings call, the company reported flat revenue and suggested the layoffs would help it restrategize its approach to direct-to-consumer sales, lower costs and streamline its leadership structure.

What they're saying: "Nike for years has been known for having layers and layers of management," Matt Powell, a consumer practice advisor with BCE Consulting, told Axios. "Now, they're trying to cut out a big chunk of expenses, to try to make the U.S. business more profitable."

  • In an emailed statement to Axios, Nike said: "The actions that we're taking put us in the position to right-size our organization to get after our biggest growth opportunities as interest in sport, health and wellness have never been stronger."

By the numbers: Nike's Beaverton headquarters employs roughly 11,400 people, according to an annual filing with the U.S. Securities and Exchange Commission — so April's layoffs accounted for more than 6% of its local workforce.

  • If we assume those workers are now without jobs and living in Washington County, it would bump the county's unemployment rate from 3.7% to 3.9% — not a huge shift, according to Damon Runberg, an economist with Business Oregon.

The bottom line: Many of the cuts came from Nike's North American group, which affected "as much management and strategy people as product developers," Powell said.

  • People in this sector have an average annual wage of $148,000, considerably higher than the statewide average, Runberg told Axios.
  • "Losing higher-wage workers is a big deal, as they account for a disproportionate share of discretionary spending."

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