Bethesda, Md.-based Marriott International is a company that "embraces change," according to its CEO Anthony Capuano. Unfortunately, this change entails laying off more than 800 corporate Marriott employees.
A Maryland Work Adjustment and Retraining Notification was filed Nov. 14. According to the listing, 833 people are slated to lose their jobs. Marriott is a leading private-sector employer in Montgomery County, where its headquarters have been for more than 60 years. The effective date for the cuts is Jan. 3.
"Our business momentum is excellent, and as a company that embraces change, we continue to evolve our business to support our global growth," Capuano said in the Q3 earnings call held last Thursday. "To this end, we have undertaken an enterprise-wide process to enhance our effectiveness and efficiency across the company. We want to further empower our teams closest to our markets, guests, owners and franchisees to operate even more nimbly. While this work is not yet complete, we believe these efforts will drive increased profitability and enhanced value."
Marriott CFO Leeny Oberg followed up Capuano's comments by saying that "at this point in the process, we expect these efforts to yield $80 million to $90 million of annual pre-tax general and administrative cost reductions beginning in 2025. In addition, we expect to deliver cost savings to our owners and franchisees. This initiative is anticipated to result in roughly $100 million of charges, primarily in the fourth quarter of 2024. The charges will be recorded in restructuring and merger-related charges and in reimbursed expenses. With meaningful growth opportunities around the world across our more than 30 brands, we’re confident these efforts will make us even more competitive."
Read the Marriott-issued transcript of the call.
The statement issued by a Marriott spokesperson regarding the cuts was brief. "Earlier this year, we began a strategic review of all aspects of Marriott International’s business across geographies to enhance our enterprise-wide effectiveness and discussed this initiative on our Q3 earnings call. While always difficult, these job reductions at our corporate and continent offices will reshape the way we work and are expected to be largely in place in Q1 2025. As a part of this initiative, several hundred job openings will be made available. Many affected associates are expected to apply for and be selected for these roles and will remain employed with the company."
According to the spokesperson, "staffing at hotels is not part of the scope of this initiative. Eligible employees will be offered severance, including outplacement assistance." When asked how this initiative would benefit franchisees, owners and operators of Marriott properties, the spokesperson said, "While we expect to deliver cost savings to our owners and franchisees as a result of this initiative, I don’t have anything specific to share."