Manufacturing Meltdown: Layoffs Hit Illinois Factories Hard

While the job market seems to be in relatively good shape, some states are feeling the burn – Illinois being one of them. Here’s the full story.

Factories in Crisis

Image Credit: Pexels / Pixabay

In the last three months, factories in Illinois have been struggling.

Layoffs and Shutdowns

Image Credit: Pexels / Stefan Stefancik

There have been a lot of layoffs, and in total, four factories in the state have shut down.

Layoffs have affected over 1000 Illinoisans, and companies like Quaker Oats Company, Blommer Chocolate Company, Rivian, and Monterey Mushrooms have been impacted.

Economic Woes

Image Credit: Shutterstock / Sauko Andrei

Factories have pointed to increased manufacturing costs and revenue losses as the culprit for these layoffs – all due to inflation.

It’s a trend that follows from 2023, which saw labor costs soar, materials spike in price, and energy bills go through the roof.

Quaker Oats’ Decision

Image Credit: Shutterstock /Matej Kastelic

Quaker Oats announced that it would be laying off over 500 employees as it shifts its manufacturing process from its Danville facility to their other factories in states with cheaper costs.

Danville Dilemma

Image Credit: Shutterstock / Aleksandar Malivuk

Quaker had previously paused production at the factory in December due to a product recall. During that time, they undertook a review and found that the factory wasn’t meeting their needs.

To meet future manufacturing needs, they would have to spend considerable time and money modernizing the facilities, a cost they couldn’t justify.

Danville Reacts to Quaker Oats Layoffs

Image Credit: Shutterstock / Salivanchuk Semen

Quaker’s Danville factory has been open for 65 years, and local communities have rallied around the employees, who will be officially out of work effective June 8th.

In a press release, Quaker stated, “We do not make this decision lightly and recognize the impact it will have on our employees, their families, and the Danville community.”

Chicago Plant Closure

Image Credit: Pexels / Mark Stebnicki

Similarly, Blommer Chocolate Company notified state officials in late March that it was planning to close its plant in the Chicago Fulton River District. As of May 31st, 226 employees will lose their jobs.

The End of Blommer Chocolate

Image Credit: Shutterstock / Georgy Dzyura

Their reasons were similar to Quaker’s – growing maintenance and operating costs for the building and aging equipment have led to issues with meeting production demand.

Sweet Sadness

Image Credit: Pexels / Anna Shvets

Blommer’s Chicago factory opened in 1939 and was the original home of Blommer Chocolate.

Rivian’s Rocky Road

Image Credit: Pexels / Andrea Piacquadio

Electric car manufacturer Rivian is also facing challenges in 2024.

After laying off 6% of its workforce in 2023 and a further 10% of its salaried employees in February 2024, the Amazon-backed firm announced a third round of layoffs in March.

Navigating Economic Uncertainty

Image Credit: Shutterstock / Zoriana Zaitseva

100 employees – just over 1% of the workforce – were made redundant at its assembly plant in Normal.

Amazon’s Troubled Investment

Image Credit: Shutterstock /Gorodenkoff

Rivian reported a loss of $1.5 billion in the fourth quarter of 2023 and is trying everything possible to turn a profit on its electric vehicles, which retail for around $70,000.

The company’s stock price is down to around $11 a share –  a far cry from its $78 debut in November 2021.

Challenges Ahead

Image Credit: Shutterstock /rawf8

Rivian’s founder wrote an email to staff stating, “Our business is facing a challenging macroeconomic environment – including historically high-interest rates and geopolitical uncertainty – and we need to make purposeful changes now to ensure our promising future.”

Bureau County Farm Closure

Image Credit: Pexels / Travis Saylor

After facing various challenges, Monterey Mushrooms closed its farm in Bureau County, resulting in around 300 employees losing their jobs.

Fungus Fallout

Image Credit: Shutterstock / Deemerwha studio

The company cited various challenges, including the global pandemic, weather impacts, inflation, and shifts in market behavior, as reasons for the closures.

DePue’s Community Resilience

Image Credit: Shutterstock / Lomb

This is another example of a community rallying around those who had lost their job, as local residents and school staff of DePue (a small village in Bureau County) organized a job fair in collaboration with local companies to help those newly out of work.

The Impact of Monterey Mushrooms’ Closure

Image Credit: Shutterstock / christinarosepix

DePue is a village with close ties to the Monterey Mushroom factory, with nearly half of the households in the district having at least one family member employed at the factory.

A Beacon of Hope

Image Credit: Shutterstock / PeopleImages.com – Yuri A

According to the school board president for the DePue district, the job fair helped save the community and the district.

Manufacturing Meltdown

Image Credit: Shutterstock / fizkes

Over the years, the manufacturing sector in Illinois has seen a significant decline in employment.

From Boom to Bust

Image Credit: Pexels / Cọ Sơn Thanh Bình

According to data from the U.S. Bureau of Labor Statistics, around 927,300 people were employed in manufacturing roles in February 1990, whereas in February 2024, the number decreased to approximately 581,000.

The post Manufacturing Meltdown: Layoffs Hit Illinois Factories Hard first appeared on Wealthy Living.

Featured Image Credit: Pexels / Pixabay.

The content of this article is for informational purposes only and does not constitute or replace professional financial advice.