John Deere has announced that 75 employees will lose their jobs at the Ottumwa Works facility on February 7. This decision follows other recent workforce reductions at the company’s Iowa plants.
Support for Affected Workers
John Deere will offer affected employees supplemental unemployment benefits. These benefits will cover about 95% of their weekly net pay for up to 26 weeks, depending on their years of service. The company will also provide transitional assistance and profit-sharing benefits. Workers can maintain their health care coverage for up to six months if they meet eligibility requirements.
Recent Changes at Ottumwa Works
The Ottumwa plant temporarily halted production in December. Earlier in 2024, 103 employees accepted early retirement offers. In 2022, John Deere relocated some operations from Ottumwa to Mexico.
Currently, the facility employs 575 workers. It manufactures equipment such as round balers, self-propelled windrowers, square balers, and components for other John Deere factories.
Company’s Commitment to U.S. Operations
John Deere says it is committed to U.S. manufacturing and has invested in Iowa facilities, including Ottumwa.
“John Deere remains dedicated to supporting local production and has made significant contributions to our U.S. locations.”
Broader Impact on Iowa
Since April 2024, John Deere has laid off more than 1,800 workers across its Iowa operations. The company explained that these adjustments are necessary to “stay competitive globally.”
“John Deere remains committed to U.S. manufacturing and has made significant investments across Iowa, including Ottumwa,” said a company spokesperson when asked about the plant’s future
Economic Challenges for John Deere
The company reported a 30% drop in annual profit for fiscal 2024, earning $7.1 billion compared to $10.2 billion the previous year. Sales fell 16% due to weaker demand, driven by economic pressures and supply chain challenges.
Falling crop prices, higher interest rates, and reduced cash receipts for major crops are limiting customer spending. USDA data predicts a 16% decline in crop cash receipts for 2024, following an 8% drop in 2023.
Investments in U.S. Operations
John Deere emphasized that more than 75% of its U.S. products are assembled domestically. The company has invested $2 billion in its U.S. facilities over the past five years and employs 30,000 workers at 60 locations.
Regional Impact
This is the second major layoff in Wapello County this year. Last week, Cargill announced that it would cut 29 jobs at its Eddyville plant.
