LEXINGTON, Neb. (AP) — A small town in rural Nebraska is losing its largest employer, a Tyson Foods beef plant that will lay off 3,200 workers next month in a town of about 11,000.
Lexington, Nebraska is expected to lose hundreds of families who will be forced to relocate in search of another job. The exodus will likely cause layoffs in the city’s stores, restaurants and schools.
The impact on the city and workers will be “close to the poster child for hard times,” said Michael Hicks, director of the Center for Economic and Business Research at Ball State University in Indiana.
In total, job losses are expected to reach 7,000, mostly in Lexington and surrounding counties, according to estimates from the University of Nebraska, Lincoln, shared with The Associated Press. Tyson employees alone will lose about $241 million in wages and benefits annually.
It threatens to unravel a city where the American Dream was still attainable, where immigrants who spoke no English and never graduated from high school bought homes, raised children in a safe community, and sent them to college.
Tyson says it is closing the plant to “right-size” its beef business after a historically low U.S. cattle herd and the company’s projected loss of $600 million in beef production next fiscal year.
Tyson workers, business owners and city leaders spoke to The Associated Press for a report on the plant closing.
Here are some takeaways.
Tyson’s factory is central to the city’s economy and community
Lexington is near the dead center of the United States, surrounded by cornfields, grain silos and cattle.
The plant opened in 1990 and was bought by Tyson a decade later, attracting thousands of workers to work on cleaning crews and forklifts, in the slaughterhouse and cutting meat.
The city nearly doubled its population and flourished with leafy neighborhoods, recreation centers, a single-screen movie theater, and a good school system. Nearly half of Lexington’s students have a parent who works at the Tyson plant, school officials estimated.
Many Tyson workers have lived in Lexington for decades, building community at the plant and in the city’s many churches, including Francisco Antonio.
The 52-year-old father of four said he would stay in Lexington for a few months and look for work, although “there’s no future for him now.” He took off his glasses, paused, apologized and tried to explain his emotions.
“He’s mostly at home, not at work,” he said, replacing his glasses with an awkward smile.
Tyson workers, devastated by the closing, have no clear plan
Thousands of Tyson workers have mortgages, car and insurance payments, property taxes or tuition costs that they won’t have an income to pay.
For many, finding another job isn’t easy, especially older workers who don’t speak English, haven’t graduated from high school, and aren’t computer savvy. The last application filled out by some was decades ago.
“We know that we only work in the flesh for Tyson, we have no other experience,” Arab Adan said. The Kenyan immigrant was sitting in the car with his two energetic sons, who asked him a question he has no answer to: “Which state are we going to, Dad?”
“They only want young people now,” said Juventino Castro, who has worked at Tyson for a quarter century. “I don’t know what will happen in the time I have left.”
Lupe Ceja has saved a little, but it won’t last long. Luz Alvidrez has a cleaning gig that will sustain her for a while. Others may return to Mexico for a time. No one has a clear plan.
“It’s not going to be easy,” said Fernando Sanchez, a 35-year-old Tyson worker who stayed with his wife. “We started from scratch here, and it’s time to start from scratch again.”
Tears streamed down his wife’s cheeks and he squeezed her hand.
The closure of the plant will affect local businesses
The domino effect could go something like this: If 1,000 families leave the city, said economist Hicks — who wouldn’t be surprised if it were double that — school seats would be left empty, leading to teacher layoffs; there would be far fewer customers in restaurants, shops and other businesses.
Most of the customers at Los Jalapenos, a Mexican restaurant next to the plant, are Tyson workers. They fill the booths after work and are greeted by owner Armando Martinez’s mustachioed smile and shout of “Hola, amigo!”
If he can’t keep up with the bills, the restaurant will close, said Martinez, who is on dialysis for diabetes and has a leg amputated.
“We just have nowhere to go,” he said.
Many, including City Manager Joe Pepplitsch, hope Tyson will put the plant up for sale and a new company will bring new jobs. This is not a quick fix, requiring time, negotiations, renovations and no guarantee of comparable jobs.
Pepplitsch, who noted that Tyson didn’t have to pay city taxes because of a settlement negotiated years ago, said “Tyson owes a debt to this community. I think they have a responsibility here to help mitigate the impact.”
Asked by the AP for comment on plans for the site, Tyson said in a statement that it is “currently evaluating how we can repurpose the facility into our own production network.” It did not provide details or say whether it plans to offer support to the community by closing the plant.