A massive company is now making painful layoffs in Iowa, which will affect hundreds of workers by the end of September.
John Deere on Thursday confirmed additional layoffs of 345 production workers from its operations in Waterloo, effective Sept. 20.
That brings to 894 the total since the beginning of the year at the plant.
One of Deere’s largest, it currently has about 5,000 total employees, with about 3,000 working in production and maintenance jobs.
The company also plans to lay off seven employees from its Coffeyville, Kansas, plant, effective Aug. 9.
It employs 245 people there, with about 145 working in production.
The company is experiencing a slowdown in demand for its farm equipment amid a decline in agricultural prices.
“As the largest global manufacturer of agricultural equipment, John Deere, like many others in the industry, faces significant economic challenges, including rising global operational and manufacturing costs, and reduced customer demand,” the company said in a statement to the Des Moines Register.
“These changes are being made due to reduced demand for the products produced at these facilities.
As stated in our second quarter earnings call, industry sales are expected to decline 20% from 2023 to 2024.”
The additional layoffs in Waterloo would bring the company’s total workforce reduction in Iowa by to 1,429 since the beginning of 2024, according to numbers reported to the state’s Workforce Adjustment and Retraining and Notification, or WARN, site.
Layoffs also have occurred at John Deere facilities in Ankeny, Davenport, Dubuque and Urbandale.
In addition, the company has offered early retirement packages to 103 employees at its Ottumwa plant.
The company said that for the period of their service, employees will be eligible to be recalled to their home factory, and that those laid off are automatically placed in seniority order for any available jobs they are qualified to perform.
Laid-off employees also receive supplemental unemployment pay that, when combined with state unemployment benefits, covers about 95% of their weekly net pay for up to 26 weeks, depending on their years of service.
And they can receive transitional assistance pay covering 50% of their average weekly earnings for up to 52 weeks after the supplemental pay runs out, per Des Moines Register.
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Other Economy News Today
Applications for unemployment benefits now surge to new highs, a sign that the white-hot labor market is starting to cool off.
First-time applications for unemployment benefits rose last week to 231,000, the highest level since August, per CNN.
Thursday’s data also showed that the number of continuing claims, or applications from people who have filed for unemployment for at least one week, was 1.78 million.
That’s an increase of 17,000 from the prior week, according to the Bureau of Labor Statistics.
The latest numbers come less than a week after the monthly jobs report showed the US economy added just 175,000 positions in April, less than economists expected and a steep drop-off from prior months.
US employers have now added an average of 245,500 jobs per month, versus 2023’s 251,000-per-month average.
Still, hiring remains strong. Although the unemployment rate ticked up to 3.9% last month, it’s the 27th consecutive month that the jobless rate has held under 4%, matching a streak last seen in the late 1960s.
Weekly jobless claims data tends to be volatile but, while one week’s worth of data “does not a trend make,” said Chris Rupkey, chief economist at Fwdbonds.
“We can no longer be sure that calm seas lie ahead for the US economy if today’s weekly jobless claims are any indication.”
“Company layoffs are picking up, hinting at caution on the part of companies as they weigh the outlook for the second half of the year,” he wrote in a note Thursday.
The Federal Reserve has been battling inflation by raising its key lending rate in the hopes of slowing the economy.
While the labor market has so far resisted those efforts, remaining white hot for the past 18 months despite 11 rate hikes from the central bank, Fed Chair Jerome Powell said last week that demand has “cooled from its extremely high level of a couple of years ago.”
Ian Shepherdson at Pantheon Economics said in a note Thursday: “We’d need to see at least a month of elevated readings to convince us that the trend really has turned.”
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Also Read: A Giant Company Now Announces Unexpected Layoffs in Virginia
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