John Deere axing 600 jobs across US Midwest as machine demand slides

With machine demand continuing to fall, John Deere has announced another 600 jobs are set to go, this time at three of its U.S. Midwest production plants.

The farm machinery giant says that in response to poor market conditions, which it predicts will further decline in the rest of 2024, hundreds more staff are set to lose their jobs.

In a statement, John Deere said, “In response to market conditions, John Deere has informed employees at three of its factories of upcoming layoffs effective Aug. 30.

“These include about 280 production workers at John Deere Harvester Works in East Moline, Ill.; about 210 production employees at John Deere Davenport Works in Davenport, Iowa; and 100 production employees at John Deere Dubuque Works in Dubuque, Iowa.

“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 further decline in the back half of FY2024.

“To better position Deere to meet future demand, we continue to take proactive steps to reduce production and inventory.”

STREAMLINING BUSINESS

This is just the latest jobs blow at John Deere, with many other positions already axed at different plants, as it tries to streamline its business models to save cash.

The downturn in tractor and machinery sales is being linked to farmers easing off new purchases on the back of lower crop prices.

A list with a number of benefits to help affected employees has been drawn up by John Deere including Supplemental Unemployment (SUB) pay, which covers up to 95% of their weekly net pay for up to 26 weeks, depending on their number of years of service.

Employees will be eligible for Transitional Assistance (TAB) pay, covering 50% of their average weekly earnings for up to 52 weeks. Additionally, profit-sharing benefits will be available based on their hours worked and the company’s profit margin, provided they have completed at least one year of service by the end of the plan year.

Healthcare benefits will also be extended, allowing employees to maintain their coverage for at least six months, or longer if they remain eligible for SUB pay. After this period, they can opt to extend coverage for another 12 months at their own expense.

John Deere is also offering Weekly Indemnity benefits to employees who become disabled during their layoff period, along with access to the Employee Assistance Program for therapy sessions.

According to the statement, the laid-off employees are eligible to be recalled to their home factory for a period equal to their length of service. Those laid off are automatically placed in seniority order for factory openings they are qualified to perform.

Some areas in the deep rural Midwest are heavily dependent on John Deere for their local survival, as the company is often the main employer in the region.

At the John Deere Harvester Works, where most of the combines are built, there are around 2,220 employees with 1,700 of those working in production and maintenance jobs. 

John Deere Davenport Works currently has about 1,390 total employees with about 1,045 working in production and maintenance jobs.

And, John Deere Dubuque Works currently has around 2,700 staff with about 1,430 working in production and maintenance jobs. 

In another snub to employees, Deere has also announced it is moving the production of skid steer loaders from its plant in Dubuque to Mexico by the end of 2026.

The company recently announced it generated over €10billion in profit last year.