Kmart lays off workers in preparation for closing

Just two weeks from closing, Carson City's Super Kmart has reduced its work force to 80 as customers continued to mill about increasingly bare aisles looking for bargains.

Blue-light special announcements have been replaced by a woman belting "God Bless America" over the intercom.

The company filed for Chapter 11 bankruptcy in January 2002, and announced the closing of 326 stores last Jan. 14.

A federal judge approved Kmart's plans to close 316 stores and borrow $2 billion as part of its effort to reorganize. Carson City's Super Kmart is one of the stores to be closed.

Fifty employees recently were laid off in Carson City, leaving 80 at the store that once employed between 250 and 270, said Kirk Hays, store director.

He said the employees were released with full benefits and paid sick leave and vacation time.

"Most had other opportunities, and the majority volunteered for the layoff," he said. "Employees can reapply at other area stores, but most are opting to find new jobs. We recently had a job fair with companies like Home Depot, Wal Mart, Target and Bed, Bath and Beyond."

Twenty-seven-year Kmart employee Hays said he's helped open about five stores, but this is his first closing. He doesn't know where he will go.

"I've seen them built from the ground up," he said. "Closing a store is tough. I just come in every day and do my job."

He said the merchandise will not be taken to another store, and there are still plenty of bargains, with clothing and other merchandise marked down as much as 80 percent.

Some of the customers Monday drove from as far away as Reno and South Lake Tahoe.

"The boys need clothes because they're boys and the selection isn't too bad yet," said Jackie Williams of South Lake Tahoe. "I got a waffle iron for $14 and nice towels for $5 each."

The closing date for the store is tentatively set for April 14, but Kmart's woes extend far beyond local problems.

Kmart Corp. on Monday announced the elimination of about 400 positions at its corporate headquarters and 123 positions nationally that provide corporate support. The company will also eliminate 137 open positions.

"The decisions resulting in today's announcement were very difficult," said Julian C. Day, president and chief executive officer of Kmart. "As we prepare to exit Chapter 11 in April, we are extremely appreciative of the contributions our associates have made while the company has undergone this major restructuring."

Associated Press contributed to this story.