Target to lay off 1,000

Target said Tuesday that it will slash 1,000 jobs at its downtown Minneapolis headquarters, laying off 600 workers and eliminating 400 open positions.

Target has about a dozen locations in the St. Louis area.

Affected employees will continue to receive their full pay and benefits through April 1, at which time they will receive severance packages based on how long they have been with the company. As part of those packages, Target will provide 12 months of continued Target health care benefits, in addition to 12 months COBRA benefits, and outplacement support to assist them in transitioning to their next position.

Target also will close its Little Rock, Ark., distribution center later this year. The facility employs about 500 workers. They will be offered positions at other Target distribution centers or will receive severance packages similar to those received by the headquarters employees.

The company already had suspended salary increases for senior management, suspended share repurchase activity, tightened credit card underwriting and credit granting, reduced its store expansion plans and cut expenses such as outside contractor support, travel and entertainment.

As a result of the layoffs, Target expects to record a charge of approximately 3 cents per diluted share, the majority of which will occur during the company’s 2008 fiscal fourth quarter, which ends Feb. 1. Target will announce its fourth-quarter earnings in late February.

Target (NYSE: TGT) has reported declining sales in recent months. The company’s same-store sales fell 4.1 percent in December, following a decline of 10.4 percent in November. In fact, the company hasn’t reported a monthly same-store sales increase since last June.