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Will Nike’s Brain Drain Show Up at Retail?

A “talent drain” at Nike could find its fingerprints on store shelves by the end of the year, Insider reported Wednesday.

At least 20 “high-level executives” left Nike in the first half of last year, the publication said. In the past three months, it claims another 20 “director-level executives” have followed suit. Of the 15 current and former employees it spoke to for the wide-ranging article, multiple reportedly compared the situation to losing “1,000 years of experience.”

The brain drain could impact Nike’s product line, employees and analysts told Insider. Given the long road a design takes from idea to market, any ripple effect will take a while to manifest publicly. One former designer told Insider that store shelves will “probably” begin reflecting employee departures by this fall or holiday. By spring and summer 2023, “you’ll definitely see it,” the source reportedly said.

Nike’s careers site currently lists 1,880 open positions, up from 1,695 early last month and 1,363 in June. Of that number, 623 are located in Beaverton, Ore., the home of Nike’s headquarters. In early December, there were 553 job openings in the company’s hometown. As of Friday, Nike listed 52 open design positions, 44 in Beaverton.

Nike’s current situation stands in stark contrast to where it was in the summer of 2020. Having just suffered a $790 million quarterly loss, the company unveiled the next phase of its Consumer Direct Offense. Dubbed the Consumer Direct Acceleration, the business plan placed the company’s focus on digital and direct-to-consumer sales with a goal of getting 50 percent of total sales from web-connected channels.

A month later, in July 2020, the company announced it was reshuffling its executive team in accordance with the new business strategy. At the time, it noted this would produce a “net loss” of jobs resulting in pre-tax one-time employee termination costs of approximately $200 million to $250 million. Within a week, Nike filed documents with the state of Oregon stating it would eliminate at least 500 jobs at its Beaverton headquarters. In November 2020, it upped that number to 700. According to The Oregonian/OregonLive, 200 of the cut jobs were at the company’s on-site childcare center, which closed permanently. The layoffs were expected to conclude by Jan. 8, 2021.

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A year later, Nike now finds itself with hundreds of job openings at its headquarters. Ignoring the layoffs associated with the childcare center, its current count of open positions sits well above the number of employees it laid off in 2020 and the first days of 2021.

It’s unclear if any of the openings are related to Nike’s vaccine mandate. Months after setting a December deadline by which all employees at its Beaverton headquarters were required to be vaccinated, Nike notified those who were not compliance earlier this month that they would be fired on Jan. 15.

At least one former Nike employee has addressed the mandate publicly. Dex Briggs, a marketing manager who had been at the company for more than two decades, claims he was fired for refusing to upload his vaccination records to a third-party platform, according to Daily Mail. The long-time employee claims he received the vaccine, but was concerned about his privacy.

“My employer is playing these political games with the lives of its employees which is why I chose not to comply with the inflexible vaccination verification policy that goes into effect today,” Briggs wrote on Facebook. “As a result, my employment will be terminated as of midnight tonight after 26 years of loyal service. Their loss.”

Briggs published his Facebook post announcing his departure from Nike on Dec. 17. However, a later update to his job status suggests he was terminated on Jan. 15.

Nike likely is, at least in part, a victim of a broader trend sweeping the U.S, the so-called Great Resignation. According to data released by the Labor Department earlier this month, 4.5 million workers quit their jobs in November, the highest number since the government began keeping track two decades ago. Though many of the quits came from retail, health care and accommodation and food services, the “professional and business services” industry accounted for 798,000 of November’s total departures.

Notably for Nike, which has reconfigured its business around digital and has signaled interest in establishing itself in the metaverse, job dissatisfaction has been particularly high in tech. According to data released by TalentLMS and Workable in October, 72 percent of tech employees in the U.S. are thinking of quitting their job in the next 12 months. An article published by Harvard Business Review in September reported that tech resignations were up 4.5 percent. Insider’s Nike report indicates the footwear giant is no exception.

“It’s happening at every big company,” a current executive told Insider in reference to employee departures. “It also seems to be happening here now, especially in the technology workforce.”

Insider’s article suggests that Nike’s back-to-office plans have exacerbated the matter— particularly when it comes to keeping and attracting tech workers. As the Omicron variant began spreading across the country in mid-December, Nike employees reportedly received an email saying the company was sticking to its mandated return-to-office date of Jan. 10. According to reporting at the time, only 54 percent of employees supported the plan. Days later, Nike indefinitely postponed its mandated office return.

In TalentLMS and Workable’s survey of 1,200 U.S. tech employees, 56 percent identified flexibility/remote work options as a top criterion when selecting a company. Nike’s careers site lists 483 position open positions in technology, of which only 42 are available for remote work. The company’s Beaverton headquarters currently has 161 job listings in technology. Thirty-two are open to remote work.

Last month, Complex reported that at least four design directors left Nike in November. Of those highlighted in the article, Chad Knight, formerly director of 3D footwear design, had been there for the shortest amount of time, five-and-a-half years. Knight, who left Nike to join Wilder World, an NFT marketplace that bills itself as “an immersive 5D Metaverse built on Ethereum,” briefly discussed why he departed on his social media.

“Was hit up by [Complex] about why I, along with several other Nike design leaders, recently left after many years,” Knight wrote on LinkedIn. “Ultimately the influx of MBA’s was preventing the expression and pollination of new ideas. Web3 is clearly the future and I wanted to build that future.”