Just this week, Tyson Foods announced that its plants in Jefferson and Chicago will be ceasing operations next year. Several factors have influenced management to make this decision: a change in Tyson’s product needs, the old age of the plants (the plant in Jefferson is 140 years old!), and the undesirable distance between the plant in Chicago and its supply source for raw materials.
Almost 900 employees will be impacted by this decision, which has yet to have an official date of implementation. Tyson is taking action to prepare the employees for this shutdown by inviting them to apply for other jobs within the company. Tyson has also made efforts to educate the employees about unemployment benefits. The company’s president of North American operations, Donnie King, has stated that many other options were considered before making this decision, and he believes that this change will allow Tyson to provide better customer service.
In response, some may seek early retirement. However, Tyson has declared it too early to establish any options for employees regarding this issue. The president of the union that works with Tyson employees, Doug Leikness, has expressed his disappointment in the official decision.
“We thought we were secure there,” said Leikness.“We thought we had the pepperoni business down pat for Tyson and we are very disappointed this is happening.”He is also concerned about the job losses and the decrease in manufacturing in Illinois due to this shutdown.
Tyson is not alone in its endeavor to cease operations in plants in order to cut costs and make the manufacturing process more efficient. Kraft Heinz Food Co. is closing plants of its own with a goal of saving $1.5 billion. The job losses due to this decision will be even greater than those of Tyson’s shutdown; although some employees will have the opportunity to work in headquarters, over 2,500 jobs will be ended via three cycles of layoffs within two years.
More than just the employees are affected, though. Local 538, the union where Doug Leikness serves as president, will lose about 65 percent of its jobs, resulting in nearly a halved revenue from loss of dues. The future remains uncertain. Leikness said, “We don’t know how Local 538 will be affected yet. We have to figure that out.”
Ever since an 11-month strike in 2003, there have been no outstanding issues within the company, so this decision seems to have been unexpected by the union and employees. Tyson has not released any information about future plans regarding the new location of the plant and whether or not job openings would result from this transfer. What is clear, though, is that other facilities in Illinois are safe for now.
The Jefferson plant has a colorful history in its 140 years of existence. Originating as a pork, beef, and lamb facility, the plant was sold nearly 60 years after its founding to become a sausage-making facility. Later, the facility focused on pepperoni and doubled its size. In 2001, the plant was bought by Tyson.
Standing as one of the top food companies in the world, Tyson Foods boasts over 110,000 employees in many countries. This cease of operations is bad news for the Jefferson and Chicago plants, but the size of the company will hopefully allow for a quick future recovery for the affected employees.