
Citing reduced demand for John Deere equipment, the Moline-based equipment maker said in a statement today, Oct. 16, it has informed at least 287 production employees at three of its Quad Cities facilities they will be laid off on Jan. 3.
The locations affected and the number of Quad Cities workers who will be laid off, according to a statement released today by Deere & Co, are:
- John Deere Harvester Works, East Moline, about 200 production employees.
- John Deere Davenport Works, Davenport, about 80 production employees.
- John Deere Seeding and Cylinder, Moline, seven production employees.
According to the company, the current total number of workers at each of these Quad Cities locations are: Harvester Works, 1,880 employees with about 1,395 working in production and maintenance; Davenport Works, 1,024 employees with 824 working in production and maintenance and Seeding and Cylinder, about 625 total employees with 427 working in production and maintenance.
The Quad Cities layoffs confirmed today are the latest in a series of cutbacks that already have impacted thousands of Deere workers at facilities in the Quad Cities, Waterloo, Iowa, and elsewhere. In addition to production workers, in July the company also cut salaried workers including 298 at Moline’s John Deere World Headquarters.
“It is important to note these layoffs are due to reduced demand for the products produced at these facilities,” Deere said in the statement it released today. “They are not related to production moves. As we have repeatedly stated, layoffs this fiscal year are due to the weakening farm economy and a reduction in customer orders for our equipment.”
Why demand is down
Deere’s statement also cited the following reasons that orders for John Deere equipment are down:
- The U.S. Department of Agriculture (USDA) forecasts major row-crop cash receipts to be down another 18% in 2024, following a 5% decline last year.
- The USDA also forecasts marketing year average prices for the new crop (crops harvested right now) to continue to decline from last year and to be down more than 30% compared to a couple of years ago (compared to 2022: corn prices are -37%, soybeans -24%, and wheat -35%).
- In the construction industry, compared to its peak in 2021, single-family home sales are down 30%, single-family housing starts are down 10%, and multi-family housing starts are down 40%.
- Despite some interest rate reductions, the current interest rate level is still elevated compared to recent history.
Benefits package outlined
In the statement Deere also outlined the benefits the laid off workers will receive.
That includes being eligible to be recalled to their home factory for a period equal to their length of service, the company said. In addition, those laid off will automatically be placed in seniority order for openings they are qualified to perform at the factory.
Laid-off employees also will receive the following monetary benefits, according to the release:
- Supplemental Unemployment (SUB) pay, which covers about 95% of their weekly net pay for up to 26 weeks, depending on their years of service.
- Transitional Assistance (TAB) pay, which covers 50% of their average weekly earnings for up to 52 weeks, after SUB pay runs out.
- Profit Sharing, which is calculated based on their hours worked, average earnings, and the company’s profit margin, if they have at least one year of service by the end of the plan year.
In addition, employees will be able to keep health care coverage for at least six months, or as long as they are eligible for SUB pay, whichever is longer. After that, they can extend their coverage for another 12 months, but have to pay the full premiums themselves.
Employees who become disabled while on layoff can get weekly indemnity benefits for the same duration as their SUB pay, up to 26 weeks, if they meet the requirements.
Employees and their household members can also access Employee Assistance Programs (EAP) services for the duration of their recall rights. EAP provides up to eight sessions of in-person or virtual therapy per year.
Additional benefits laid-off employees may receive include life insurance, legal assistance, tuition reimbursement and job-placement assistance.