Deere to lay off almost 700

Layoffs said to ensure factory production aligned with market demand

By PAT SHAVER Courier staff writer

OTTUMWA — Nearly half of the 1,000 John Deere Ottumwa Works employees were told Tuesday that they will be laid off indefinitely. And nearly 200 more will face periodic, short-term layoffs.

John Deere officials said effective June 29, 494 production employees will be laid off until later this year to ensure that factory production is aligned with market demand. An additional 195 employees face periodic layoffs, one week at a time, for up to 10 weeks.

“I think when we say it’s indefinite, it truly is indefinite. [It’s] based on market conditions, that will define when we bring employees back to work,” said Ken Golden, spokesman for the company, based in Moline, Ill.

Golden said the layoffs were all based on seniority with the company. Those who were affected will receive unemployment insurance and are eligible for company supplemental unemployment benefits.

“We told our employees that we do not expect the layoff for most employees to last beyond fall, but this is dependent on market conditions,” he said.

Late Tuesday, Gov. Chet Culver issued a statement about the Ottumwa layoffs.

“Today we received the disappointing news that hundreds of employees at the John Deere facility in Ottumwa will lose their jobs. This is just one more sign that the global economic challenge continues to affect Iowans.

“I have been in contact with officials from Iowa Workforce Development, and as a result of the Deere’s announcement, a Rapid Response Team has been dispatched to the plant [today] to work with those employees who have been affected, and determine what steps they can take to get back to work ...

“While this news — and all news on layoffs — is disappointing, I remain confident that Iowa’s best days are ahead, and I look forward to working with Iowans to create the bright future we all know is possible.”

Ottumwa City Administrator Joe Helfenberger said when he heard of the layoffs, he contacted Deere officials and they told him that nearly everyone would be hired back by fall. However, he said, the layoffs are a concern.

“Anytime there’s layoffs it affects people’s lives,” Helfenberger said.

The layoffs will likely impact the local economy, but Helfenberger said if those employees are hired back, he hopes there won’t be a long-term effect.

“If people are laid off, they have less disposable income, and they have less to spend on the local economy,” Helfenberger said. “We wish that the layoffs are minimized and the people are hired back just as soon as possible.”

“It’s hard on the community, but Ottumwa is a decent-size community and there are options out there,” said Kerry Koonce, spokeswoman with Iowa Workforce Development.

She said the IWD will be holding meetings on-site at John Deere Ottumwa Works with employees impacted by the layoffs.

“Obviously it’s 500 more people that need [unemployment] services, and that’s fine, that’s what we’re here for,” said Koonce.

She noted that despite heightened unemployment rates, there are about 15,000 job openings statewide posted on the IWD Web site.

With indefinite layoffs, some people may file for unemployment and wait it out, while others might search for another job, and others might get additional job training.

“It’s going to take longer and you may have to do training, but there are opportunities,” said Koonce.

The Courier broke news of the pending layoffs last week. Employees said they were told to expect about 500 total layoffs. Deere officials declined to comment at the time, saying company policy was to “not respond to rumors.”

Deere has experienced multiple rounds of layoffs in Iowa over the past several months. Ottumwa was involved in one round announced at the end of March. That set of layoffs involved 40 local employees.

John Deere Ottumwa Works manufactures balers, mower conditioners, windrowers and pull-type forage harvesters used by hay and livestock producers.

Pat Shaver can be reached at (641) 683-5360 or via e-mail at p.shaver@ottumwacourier.com.

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