California is in trouble.
That was my inescapable conclusion after researching just how many employers and factories are fleeing the state.
I don’t mean to be alarmist, but a healthy economy should not be shedding this many jobs this quickly.
Follow The Coconut Mama
• For fun lists, healthy living tips, and bar conversation topics, make sure to follow The Coconut Mama. Click here to access The Coconut Mama’s profile page and be sure to hit the Follow button here or at the top of this article!
• Have feedback? Add a comment below!
Shutterstock
Of course, when we click down a level, the picture gets a little more complicated.
And while every closure and exit is individual and unique in one way or another, there are certainly some overall trends I’ve observed.
What’s interesting is the explanations companies give for their decisions.
There’s no “oh we moved because the business climate is bad” or “taxes are too high” or anything like that.
It’s always about efficiency, aligning production with demand, and strengthening supply chains.
But there are a couple of “tells” that I think let us know what’s really going on here…
Shutterstock
The first is timing. Many of these closures took effect as the tariff / trade war rhetoric ramped up.
And many of them are tied to industries – like almonds, aluminum, and fruit, that have been specifically targeted by tariffs.
I somehow doubt that’s a coincidence.
The second “tell” is a little more subtle, but perhaps even more important…
Shutterstock
Many of the factories targeted by these closures are…pretty old.
I’m talking 50+ years old.
(But not quite as old as the factory in the picture.)
Think about all the technological innovations that we’ve gotten since 1975.
All the automation. All the efficiencies.
These factories weren’t built with the internet in mind. It didn’t exist yet!
They’re just, by nature, older designs that probably aren’t taking advantage of all the newest technology.
And you could go through an expensive renovation…or just expand operations at a newer facility somewhere else.
Of course…
Shutterstock
None of this is to give California a pass when it comes to regulations, taxes, and overall business environment.
(Although in my experience, it really differs more locality-to-locality than people generally like to think. Nothing’s ever as simple as we’d prefer!)
Certainly when a business talks about reducing costs and reduces its employment in California specifically – that tells us something.
(Namely, that California is pretty expensive. Which, if you’ve ever been there, you already knew.)
So it’s a combination of factors. Don’t let anyone pretend it’s just one thing.
And unfortunately…
Shutterstock
This confluence of factors – some long-term and chronic, some short-term and acute – are now hitting at a point where businesses absolutely need to cut costs to stay competitive.
And California is losing factory after factory as hundreds of workers rapidly lose their jobs.
Shutterstock
Coca-Cola’s closure of its massive American Canyon plant on June 30th was unfortunately both disappointing and very much expected.
This was a bottling facility that employed 135 workers (about 10 of which will stay on through the end of the year during the transition).
Coca-Cola has been signaling for years plans to reduce its factory footprint as it streamlines operations and offloads some of its manufacturing and logistics operations to third-party vendors.
It unfortunately makes a ton of sense.
Shutterstock
Think about it this way – what makes Coke great?
Is it superb manufacturing capacity?
A sprawling logistics network?
Great store delivery?
No.
It’s the taste of their product. Great marketing (the polar bears!). And to some extent cost.
Follow The Coconut Mama
• For fun lists, healthy living tips, and bar conversation topics, make sure to follow The Coconut Mama. Click here to access The Coconut Mama’s profile page and be sure to hit the Follow button here or at the top of this article!
• Have feedback? Add a comment below!
Shutterstock
So why do all those other things, when you can focus on the things you’re great at instead?
It’s possible – we’ll see by the time they’ve finished the transition – that it’ll even end up saving them money to go with all these third-party vendors because those vendors are so efficient and good at what they do.
But at the very least, it helps Coca-Cola stop being distracted by all this other stuff so they can focus in on what they’re really good at, and what differentiates the product.
Of course, those third-parties being so efficient means that whatever jobs reappear…there will probably be fewer of them.
But that’s unfortunately the spot we’re in today.
Shutterstock
Probably the saddest story of them all.
Spreckels operated a sugar beet processing facility in Brawley. Farmers brought their crops to the factory, and then the beets were processed into sugar for shipping elsewhere.
This was the very last sugar beet factory in California. (In fact, it was the last one on the whole West Coast.)
And it closed at the end of July.
This was the last growing season for California’s sugar beet industry.
I’m confident that’s not hyperbole – and here’s why:
Shutterstock
California’s sugar beet industry has been dwindling for years (along with the overall American sugar industry), as much cheaper foreign imports have gradually taken market share.
There’s a reason all of California’s remaining sugar beet farms were clustered around the Spreckels factory – transporting sugar beets is expensive!
Much cheaper to transport once they’ve been refined into (much lighter) sugar.
Farmers that were already getting squeezed by costs (and, let’s face it, ICE raids) simply can’t afford to pay up to transport their crops to some far away state for refinement.
I’m pretty sure every sugar beet farmer in California is about to have to find a new crop to grow, or a new job in general.
Heartbreaking for an industry that’s been active in the state for over a hundred years.
Shutterstock
The Frito-Lay plant in Rancho Cucamonga closed in early June after 50+ years of operation.
It made all our favorite brands: Funyuns, Tostitos, Doritos, and even Cheetos.
Layoffs reportedly totaled in the hundreds. Just another brutal loss for a state that, frankly, needs some good news.
Shutterstock
Blue Diamond recently announced plans to close its plant in Sacramento, potentially impacting hundreds of jobs.
Although, for what it’s worth, Blue Diamond has indicated that at least some of the workers at its Sacramento factory will have the option of transferring to other California locations which are staffing up as they pick up the production slack.
Why leave Sacramento specifically? I don’t know enough about the local laws to speak to that, but the age of the plant (50+ years) is probably a sign. If you have more insight, drop a comment and let us know!
Shutterstock
Manzana is synonymous with organic applesauce, and unfortunately they’re currently in the process of exiting California entirely with plans to relocate operations to Washington State.
The reason is heartbreakingly simple: Today only 10% of Manzana’s apples come from Sonoma County, with a much higher proportion coming from Washington State.
Why not go where all the farmers are?
So they are – ending a 100+ year run in Northern California.
Shutterstock
So there you have it – the details of all these factories rapidly leaving California.
It’s rough out there, and I hope state and local leaders are taking the manufacturing losses seriously.
But my heart goes out to the workers.
The people who built their careers and livelihoods around these good jobs.
Shutterstock
So, to those workers: I see you.
You deserved better than this.
And I hope your next chapter is kinder than this one.
And for everyone reading who isn’t affected – could you do me a favor and share some encouragement and advice to the people who are losing their jobs?
Let’s build community here. After all – we’re all in this together.
Shutterstock
Leave a Comment