Levi Strauss to Shutter Factory in Płock, Poland, Cutting 650 Jobs

Levi Strauss to close Polish factory, shedding 650 jobs, citing high labor and energy costs. Closure sparks worker protests over severance packages.

Wojciech Zylm
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Levi Strauss to Shutter Factory in Płock, Poland, Cutting 650 Jobs

Levi Strauss to Shutter Factory in Płock, Poland, Cutting 650 Jobs

Levi Strauss & Co., the iconic American denim brand, has announced plans to close its manufacturing facility in Płock, Poland, resulting in the loss of approximately 650 jobs. The decision comes as part of the company's global restructuring efforts to streamline operations and improve efficiency.

The closure of the Płock factory is expected to be completed by the end of 2023, with Levi Strauss providing support and severance packages to the affected employees during the transition period. The company cites high labor and energy costs as the primary reasons for the shutdown, stating that manufacturing in Płock and Europe is significantly more expensive compared to Asian countries.

The announcement has sparked dissatisfaction among the factory's workers, who are contesting for fair severance packages. Despite Levi Strauss' efforts to support employees during this challenging time, the Solidarity trade union has organized a protest outside the Płock factory on Thursday to advocate for the rights of the affected workers, claiming the proposed severance packages are "humiliatingly low."

Why this matters: The closure of the Levi Strauss factory in Płock is a significant blow to the local community and reflects the broader challenges facing the manufacturing industry in the face of economic uncertainty. The decision highlights the impact of rising labor and energy costs on global companies and their strategies to remain competitive in the market.

The move to close the Płock factory aligns with Levi Strauss' broader strategy to optimize its global manufacturing operations and adapt to changing market conditions. The company's decision comes amid a challenging economic environment, with the Federal Reserve's efforts to cool the labor market and curb inflation through interest rate hikes. Despite the layoffs, the overall U.S. job market has remained resilient, with the unemployment rate dipping to 3.8% and remaining below 4% for 26 straight months. However, the tech and media sectors have seen more job cuts recently, with companies like Google, Apple, and Amazon announcing layoffs.

Key Takeaways

  • Levi Strauss to close its factory in Płock, Poland, resulting in 650 job losses.
  • Closure due to high labor and energy costs, manufacturing in Europe more expensive than Asia.
  • Workers protest proposed "humiliatingly low" severance packages, Solidarity union organizes protest.
  • Closure reflects broader challenges facing manufacturing industry amid economic uncertainty.
  • Layoffs come amid resilient U.S. job market, but tech and media sectors see more job cuts.