A massive US plant now announces an additional 190 layoffs after notifying employees about 500 job cuts since March.
Deere & Co. is making more job cuts as the tractor maker intentionally looks to underproduce farm machinery in a challenging market.
Approximately 190 production workers at Deere’s Waterloo operations in northeast Iowa were notified by management of layoffs Monday morning, a spokesperson said in an email to Agriculture Dive.
The cuts, slated to take effect June 22, come just days after Deere lowered its fiscal 2024 earnings outlook to better reflect declining demand.
Deere is intentionally slowing production as high interest rates make it difficult for farmers to finance tractors, lawnmowers and other farm equipment.
Deere’s Waterloo operations manufacture some of the company’s largest tractors, including the 7, 8 and 9 series models, as well as diesel engines and drive trains.
Currently, Deere has approximately 5,200 employees, with about 3,300 working production and maintenance jobs in the city.
Recently, Deere cut 500 employees from its Waterloo Works facility after slashing more than 300 positions in March, according to Iowa’s WARN log as of Monday.
The company has also laid off a total of 150 positions from its Des Moines Works facility and close to three dozen from a plant in Illinois.
Although operating margins are at healthy levels, Josh Jepsen, Deere’s senior vice president and chief financial officer, said there’s “always opportunity to do better, and we’ll continue to take action on costs throughout the remainder of the year while still investing in our future.”
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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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