* To cut 8 percent of 24,000-strong workforce
* Says wants to slash administrative costs (Adds quotes, background)
FRANKFURT, July 16 (Reuters) - German department store chain Karstadt announced plans to cut 2,000 jobs and slash its administrative expenses as Europe’s debt woes hit retailers across the region.
Karstadt, in a statement late Monday, said it would cut its 24,000-strong workforce by 8 percent by the end of 2014, part of measures to trim its organisation structure.
“Given the challenging market conditions brought about by the euro zone crisis, Karstadt will simplify its structure and processes...” it said.
Retailers are struggling as consumers get squeezed by rising prices, muted wage growth and government austerity measures, while confidence is sapped by the euro zone debt crisis.
France’s Carrefour, Europe’s biggest retailer, said last week that trading remained weak in austerity-hit countries like Spain and Italy and it expects a year-on-year profit drop of 5-8 percent this year.
German rival Metro warned this month the crisis was hurting demand in Europe’s biggest economy, hindering Germans’ desire to buy.
Karstadt was on the brink of being insolvent when it was bought in 2010 by billionaire investor Nicolas Berggruen, who then invested some 160 million euros ($195.84 million) to compete with the likes of Metro’s store chain Kaufhof. ($1 = 0.8170 euros) (Reporting By Marilyn Gerlach; Editing by Gerald E. McCormick and John Wallace)