ConAgra Foods confirmed it will cut 1,500 jobs. The company claims it wants to run a leaner business and will be axing about 30 percent of its entire workforce. Additionally, the company is relocating its headquarters from Omaha, Nebraska to Chicago.
The maker of Slim Jims, Peter Pan peanut butter, Hebrew National hot dogs, Orville Redenbacher popcorn, and Chef Boyardee, ConAgra Foods will be laying off about 1,500 or 30 percent of its employees. The job cuts will directly impact its corporate offices worldwide as the company has confirmed it will be axing only office-based positions. The company has clarified that none of its employees in the food production plants will be let go.
As part of the major reshuffle, ConAgra will also be moving its headquarters to Chicago from Omaha, Nebraska. The company is keen to execute the shift and expects about 700 workers to be working in Chicago starting next summer. ConAgra has been busy finalizing the office spaces where it will place the company’s senior leadership as well as some operations for its consumer foods segment that are currently operating from their respective bases in Omaha and Naperville, Illinois.
Interestingly, though the company is shifting its headquarters, it won’t be completely abandoning Omaha. In fact, a majority of its employees will still be working from their old offices. ConAgra has planned to keep 1,200 employees at its old headquarters. These employees will be responsible for supply chain management, research, and development, as well as some other key administrative functions.
Speaking about the same, ConAgra CEO Sean Connolly said, “ConAgra Foods will retain a major presence in Omaha, where we have deep roots. However, the company is making difficult and necessary decisions to help boost productivity and profits.”
With offices in Omaha, Lincoln, and across the Missouri River in Council Bluffs, Iowa, ConAgra has about 3,000 employees. Incidentally, the company has decided to completely shutter its offices in Naperville, Illinois, which is about an hour away from Chicago. However, the 320 to 350 employees working there won’t all be losing their jobs. ConAgra indicated that these employees could be absorbed in its new headquarters in Chicago.
Why is ConAgra shedding 30 percent of its workforce? One of the largest blue chip companies, ConAgra was founded at the turn of the century in 1919, after the successful merger of four flour mills. A flourishing operation during major part of the century, CongAgra has been facing tough times during the rapidly changing economy, just like everybody else. The company had reported a first-quarter loss of $1.2 billion last month.
Quite recently, other blue chip companies like Hewlett-Packard, Whole Foods, Kraft Heinz, Microsoft, and many others have announced big layoffs, reported CNN.
By cutting 1,500 jobs and restructuring its workforce, ConAgra plans to save at least $300 million over the next few years, a major chunk of which could be realized before the end of 2017’s fiscal year. These savings are in addition to about $150 million, the company is already saving by the cost reduction techniques it has been strictly following for the last two years.
However, the company realizes that letting people go and radically altering how it functions costs money and hence, has provisioned about $345 million in one-time charges over the next two to three years, reported Yahoo News.
Indicating why ConAgra is willing going through the hassle, the company’s spokesman Jon Harris said, “It is critical that we run as lean and as efficient and as effective as possible. The jobs being eliminated are primarily redundant positions or jobs that will be outsourced.”
While Omaha is losing ConAgra, Chicago is cementing the fact that it is one of the world’s favorite destinations for multi-billion dollar food processing companies.
[Image Credit | Daniel Acker, Eric Francis / Getty Images, ConAgra]