CVS to layoff nearly 3,000 people

Pharmacy chain CVS Health announced it will be laying off nearly 3,000 employees. Most of the positions will come from corporate.

Mike DeAngelis, executive director of corporate communications for CVS told USA Today, “Our industry faces continued disruption, regulatory pressures, and evolving customer needs and expectations, so it is critical that we remain competitive and operate at peak performance,” as the reason behind the job cuts.

He said that CVS “prioritized cost savings everywhere we could” before deciding to lay off workers. DeAngelis said the staffing cuts “will not impact front-line jobs in our stores, pharmacies, and distribution centers.”

CNN reported that drug stores across the county are having difficulty because the amount they get reimbursed for prescription drugs is lower than in the past.

In all, 2,900 people will lose their jobs or less than 1% of employees.

This was not the first time CVS had reduced staffing. Last year it cut 5,000 “non customer-facing” jobs to reduce costs.

CVS was also looking at options to separate its retail division from its insurance offerings, Reuters exclusively reported on Monday.

“The company is operating well below its potential and has fallen short in its investment and actuarial approach in recent years, creating economic losses and volatility that pressures its people, its customers and its shareholders,” Glenview Capital Management said Tuesday as it worked with CVS to strengthen its performance. Glenview told Reuters it is not trying to break up CVS.

CVS had said that it wants to save $2 billion through a multi-year plan by streamlining operations and using artificial intelligence and automation.

“We’ve embarked on a multi-year initiative to deliver $2 billion in cost savings by reducing expenses and investing in technologies to enhance how we work,” a spokesperson told CNN after the announcement of the latest cuts.

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