Via MSNBC:

NEW YORK – Macy’s Inc. announced Monday that it will cut 7,000 jobs, or 4 percent of its work force, and slash its dividend as the department store chain looks to lower expenses and preserve cash amid a severe pullback in consumer spending.

This comes on top of the 11 store closures, affecting 960 additional employees, that Macy’s announced just last month. The Cincinnati-based company hopes to save $400 million in selling, general and administrative expenses starting in 2010 with this new wave of cuts. 

Macy’s also slashed its dividend from 13.25 cents to 5 cents. The dividend will be paid on April 1 to shareholders of record March 13. As of 3:23 PM, the stock (M) was trading at 8.62, down 3.69%, after hitting an intraday low of 7.50.

Department stores have been especially hard-hit by the poor economy as shoppers turn to discount stores, such as Walmart (WMT) and Family Dollar (FDO).