Factories Close for Good as Coronavirus Cuts Demand
Factory furloughs across the U.S. are becoming permanent closings, a sign of the heavy damage the coronavirus pandemic and shutdowns are exerting on the industrial economy.
Makers of dishware in North Carolina, furniture foam in Oregon and cutting boards in Michigan are among the companies closing factories in recent weeks. Caterpillar Inc. said it is considering closing plants in Germany, boat-and-motorcycle-maker Polaris Inc. plans to close a plant in Syracuse, Ind., and tire maker Goodyear Tire & Rubber Co. plans to close a plant in Gadsden, Ala.
Those factory shutdowns will further erode an industrial workforce that has been shrinking as a share of the overall U.S. economy for decades. While manufacturing output last year surpassed a previous peak from 2007, factory employment never returned to levels reached before the financial crisis.
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The closures suggest that a growing share of the record job losses in recent weeks won’t be temporary, said Gabriel Ehrlich, an economic forecaster at the University of Michigan. The more that job losses turn from temporary to permanent, he said, the harder the hit to consumer spending and every company that relies on it—including manufacturers.
Layoffs have already wiped away nearly a decade of employment gains at U.S. manufacturers. Factories added 1.4 million workers from 2010 through the end of last year, employing a total of 12.9 million people in December. The manufacturing workforce has since dropped to 11.5 million, the Bureau of Labor Statistics said Friday, including 1.3 million jobs lost in April alone, though this also includes temporary layoffs. Manufacturers in recent years have pushed up output faster than they have expanded payrolls, in part by investing in automation. Since the pandemic took hold, capital investment by manufacturers has cratered.
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Chicago-based R.R. Donnelley & Sons Co. told analysts last month that demand for its printed signs and mailers fell as companies cut back on marketing over the past two months. The company is closing two printing plants in St. Louis and laying off 72 workers. Lenox Corp., a maker of china dishes including sets for the White House, is closing its last factory, in Kinston, N.C., and laying off 159 employees, who produced as many as 20,000 pieces of fine china each day.
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https://www.wsj.com/articles/factories-close-for-good-as-coronavirus-cuts-demand-11589122800 (subscription)
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... because China is currently more willing to tolerate the pollution that such manufacturing creates. To make them without pollution would greatly increase the cost.
Pittsburgh and it's surrounding areas no longer have the steel-making capability the once had, but the air is a lot cleaner now.
