Party City shuts down business in the U.S., fires employees just days before Christmas without severance pay

Party City has announced the closure of its operations in the United States just days before Christmas, as reported by CNN and other outlets. Although struggling, the business had lumbered out of bankruptcy just this year, but that progress was ultimately not enough to save it from closures.

The party chain has more than 750 locations across a number of countries, and it’s understood that the decision to shut down operations affects only the U.S. portion of the business — Party City locations in Canada and Puerto Rico are said to be unaffected by the decision.

This awful news comes right before Christmas. Party City’s CEO Barry Litwin addressed corporate employees, telling them that the business would be “winding down” its operations immediately — and that the day of the announcement would be their final day of employment. To add insult to injury, staff were told they wouldn’t be receiving any severance pay and their benefits would end with their employment.

Party City is the largest party supply store in the USA, known for its range of products including its balloons, balloon filling, and its Halloween lines. The business was well known, and frequented by many people including celebrities like Brie Larson. That iconic status evidently wasn’t enough to save the ailing business, as swathes of staff members have already been fired, with the final closure of all Party City locations scheduled for the end of February 2025.

As soon news of the closures hit social media, people were quick to respond with their memories of the business — and commiserations for the thousands of staff facing unemployment over Christmas.

Many of the responses were direct with their sympathy for the workers at Party City who hadn’t even been told there were problems — and who didn’t find out about the closures until just before Christmas — with one user calling the behavior “evil.”

Other users were emotional about the closures because of treasured childhood memories, with many users reminiscing about trips to Party City stores to put together costumes or grab party supplies.

Although many users wanted to show their support for the chain, other users expressed surprise that the business hadn’t already gone under, including some who’d never even heard of it.

Despite the outpouring of love for the chain on X, it’s clear that the financials simply weren’t there for the business to keep operating. “Love” can only go so far when it’s cold, hard cash that keeps a business afloat. Party City had to compete with giants like Amazon, Costco, and Walmart, as well as more agile pop-up concepts like Spirit Halloween, for a seasonal snatch of market share. In today’s world, where convenience or hype can make or break a business, Party City seemed like it just couldn’t keep up.

This will be of little comfort to the employees who have already lost their jobs, or to the employees who know that when March comes, they will be unemployed. While CEO Litwin reportedly apologized for the poor communication regarding the mass firing, words can’t fix former employees losing their benefits, nor will it make up for lack of severance pay. As much as many Americans feel the loss of Party City, the real tragedy is for those workers who will go into the Christmas period with the dark cloud of sudden unemployment hovering over their heads.