Nestle To Lose Valley Food Plant
By Chris Kirkham and Andrew Khouri, Aug. 6, 2014, Latimes.com
Nestle USA will close a San Fernando Valley production plant that makes Hot Pockets by early October, shifting operations to an existing plant in rural Kentucky where costs are cheaper.
The move will eliminate 360 jobs at the Chatsworth plant, which has been making the frozen sandwiches since 1988.
A spokeswoman for Nestle USA, based in Glendale, said Wednesday that the consolidation at the Kentucky plant gives the company more room to expand and a more centrally located distribution point.
"Our overarching goal is to run highly efficient manufacturing facilities and try to be as close as possible to the customers we serve," said Nestle spokeswoman Roz O'Hearn.
It's a significant loss. But it's indicative of the problems in the city and the state with business unfriendly practices.- Stuart Waldman, president of the Valley Industry & Commerce Assn.
Experts said Nestle's decision is in line with a larger exodus of manufacturing jobs from Southern California over the last two decades.
Los Angeles County has seen a 57% decline in the number of manufacturing jobs since 1990, compared with a 31% drop nationally, according to federal and state data. As a percentage of the workforce in the county, manufacturing jobs dropped from nearly 20% in 1990 to 8.4% this year — a steeper decline than the rest of the country.
California's high cost of living can be a serious cost consideration for firms, especially food manufacturing jobs that tend to pay low wages.
Nestle USA will close a San Fernando Valley production plant that makes Hot Pockets by early October, shifting operations to an existing plant in rural Kentucky where costs are cheaper.
The move will eliminate 360 jobs at the Chatsworth plant, which has been making the frozen sandwiches since 1988.
A spokeswoman for Nestle USA, based in Glendale, said Wednesday that the consolidation at the Kentucky plant gives the company more room to expand and a more centrally located distribution point.
"Our overarching goal is to run highly efficient manufacturing facilities and try to be as close as possible to the customers we serve," said Nestle spokeswoman Roz O'Hearn.
It's a significant loss. But it's indicative of the problems in the city and the state with business unfriendly practices.- Stuart Waldman, president of the Valley Industry & Commerce Assn.
Experts said Nestle's decision is in line with a larger exodus of manufacturing jobs from Southern California over the last two decades.
Los Angeles County has seen a 57% decline in the number of manufacturing jobs since 1990, compared with a 31% drop nationally, according to federal and state data. As a percentage of the workforce in the county, manufacturing jobs dropped from nearly 20% in 1990 to 8.4% this year — a steeper decline than the rest of the country.
California's high cost of living can be a serious cost consideration for firms, especially food manufacturing jobs that tend to pay low wages.
Read the full story: www.latimes.com
Related: Leaving Chicago for California to lower costs? --Jelly Belly Brand Leaving Chicago
Related: Leaving Chicago for California to lower costs? --Jelly Belly Brand Leaving Chicago
Follow Larry Elder on Twitter
"Like" Larry Elder on Facebook
