Swisher moving some operations to Dominican Republic, 250 to lose their jobs

[thelakelander]

We just lost some more manufacturing jobs to a different country. During the last decade, Swisher employed as many as 1,100 employees at their New Springfield plant.  They now employ a little over 500.

Swisher to lay off 250 in Jacksonville

Swisher International will lay off 250 employees in Jacksonville as it moves some of its cigar-making production from the city to the Dominican Republic. The company notified the employees on Friday that the layoffs will take place over the next 12 months.

The action follows 150 layoffs last year.

Joe Augustus, senior vice for global affairs, said that several factors caused the decision.

"We have established competitors bringing in cigars from offshore at a very low price," he said. "And we've got government regulation and taxation that increases the cost."

When excise taxes were increased on all tobacco products in 2009, Augustus said Swisher had to raise its prices 35 percent to cover the hike.

full article: http://jacksonville.com/business/2013-09-20/story/swisher-lay-250-jacksonville

[ben says]

Less than surprising

[peestandingup]

Globalism. It just works.

[CityLife]

I wonder how much automation and robotics have affected their staffing needs? Could be more of a taxation/real estate cost decision than workforce cost issue.

Anyone catch the 60 Minutes piece on robotics a few weeks back? I've saying for years now that automation and robotics will drastically alter the workforce in the coming future (as have quite a few others), but its interesting to see how quickly some of it is occuring.

[thelakelander]

In the article, they claim it is the result of a taxation issue.

[fsquid]

In the article, they claim it is the result of a taxation issue.

I can't believe that

[danno]

And my employer British Airways is sending over 250 jobs overseas at the end of the year... A large majority to India.

[peestandingup]

In the article, they claim it is the result of a taxation issue.

I can't believe that

It's not. I mean, it may be a little of that, but they're doing what every other big company in the US has done. Shipped the manual labor jobs overseas to take advantage of slave wages/no healthcare, and replaced what's left in the states with automation. Yet none of these greedy fools realize that enough of that & it eventually ends up you don't have any products to sell to people because they dont have any income that were provided from these jobs. plus, destroyed a lot of fabric of communities.

That's when debt enslavement comes in.

[NotNow]

http://www.ttb.gov/main_pages/schip-summary.shtml

Look at the table and figure the increases for yourself.  I believe that most of these products ship overseas, so the savings are pretty significant if operations stay out of the US.

[peestandingup]

In the article, they claim it is the result of a taxation issue.

I can't believe that

It's not. I mean, it may be a little of that, but they're doing what every other big company in the US has done. Shipped the manual labor jobs overseas to take advantage of slave wages/no healthcare, and replaced what's left in the states with automation. Yet none of these greedy fools realize that enough of that & it eventually ends up you don't have any products to sell to people because they dont have any income that were provided from these jobs. plus, destroyed a lot of fabric of communities.

That's when debt enslavement comes in.

Agree, those greedy bastards should just go out of business. If their competitors are bringing cigars into the US market cheaper and they can't match the cost, they should fold it up. That will show em. Then all their employees will be unemployed, but they'll be able to sleep at night.

Maybe, but they could at least be honest about it. Besides, every company that does this is further down the rabbit hole we all go. If they have to do it to solely survive, I'd say we've got bigger fish to fry, wouldn't you. Somewhere around 85% of US manufacturing has gone bye bye since the 70s, and that's no joke. But at this point in time, the damage is done & it wont likely matter with the advancements in technology, automation, etc. Even service jobs like fast food will utilize this.

I've said this a million times, but society is eventually gonna have to re-think what it means to have a job, money, be a productive member of society, etc. If we don't & end up staying the traditional course, then many many people will eventually get swept under the rug & it'll end up being only two classes (rich & poor). It's happening now in case no one has noticed. The middle class isn't just going away on its own.

[tufsu1]

Agree, those greedy bastards should just go out of business. If their competitors are bringing cigars into the US market cheaper and they can't match the cost, they should fold it up. That will show em. Then all their employees will be unemployed, but they'll be able to sleep at night.

perhaps they should consider a "Made in the USA" ad slogan....I know lots of people that will gladly pay a bit more for something made here.....and believe me, the end game cost difference is marginal at best (do some research on iPhone for example)

[thelakelander]

Interesting Swisher Fact from wiki

1930
During the darkest days of the depression, at a time when most companies are letting people go, Swisher hired hundreds. Swisher's hiring record earned the company Forbes magazines certificate of merit for having had "the vision, courage, and faith in America's future to make large investments in the face of depression problems."

Hmm. Coming from Central Florida, I grew up hearing the story from those who got the short end of the economic stick. I may be wrong, but I believe Swisher was a leader in the mechanizing the cigar manufacturing process back in the 1930s. That killed Tampa's cigar industry, resulting in thousands of lost jobs, turning Ybor into one blighted ghetto in the process.

Ybor City was founded as an independent town in 1885 by a group of cigar manufacturers led by Vicente Martinez-Ybor and was annexed by Tampa in 1887. The original population was mostly composed of Cuban and Spanish immigrants who worked in the cigar factories. Italian and Eastern-European Jewish immigrants following shortly thereafter, predominantly founding retail shops, farms and grocery stores, and other businesses which catered to the cigar industry and its workers. Beginning in the mid-1890s, neighborhood residents founded mutual aid societies, labor organizations, newspapers in several languages, and many social and civic organizations, helping to create a vibrant civil society that blended the residents' different cultures of origin into a new "Latin" culture unique to Tampa.

Ybor City grew and prospered from the 1890s until the Great Depression. In the early 1930s, a sharp reduction in the worldwide demand for fine cigars caused some cigar factories to close, others to mechanize to reduce labor costs, and virtually all remaining operations to decrease production, depriving the neighborhood of many good-paying jobs.

http://en.wikipedia.org/wiki/History_of_Ybor_City

That also expanded quite a bit in the mid-80's through numerous acquisitions. Maybe they got a little too big and need to restructure some.

What wasn't taken out in the 1930s as tackled in the 1980s....

Corral Wodiska Company, makers of Bering Havana Cigars, 1302 19th Street.  This building was completed in 1909 for the Esberg-Gunst Cigar Company. In 1925, it was purchased by the Corral-Wodiska and Company. Cigar manufacturing would end when the company was purchased by Jacksonville's Swisher in 1985.

http://www.tampapix.com/ybor2.htm

[Tacachale]

Time for Tacachale Presents Florida Smoking History.

In reality several factors contributed to the decline of the cigar industry in Tampa and the rest of the state. More so than mechanization, the single largest factor was the rise of cigarette smoking. This took off in the early 20th century and came to a head during the Great Depression, when cigarettes came to be seen as a cheaper, more accessible alternative to cigars, and gained a certain cultural cachet that still perpetuates today. It was decades before the health risks became part of the national conversation, and even now all forms of tobacco get "rolled up" into discussions about cigarette smoking

Additionally, it tends to get glossed over nowadays, but the backbone of the cigar industry in Ybor City and West Tampas relied on a mass-production factory model. The cigars were rolled by hand, but the bulk of the product wasn't necessarily the high quality "artisan" cigars many contemporary smokers expect out of hand-rolled cigars. Tampa was the undisputed leader in the state, but several Florida cities including Jacksonville had booming cigar industries owing to their climate and labor pool. In the 1920s and 30s, the Swishers were pioneers in developing mechanical processes that created cigars of similar quality to what was coming out of Tampa at the time. Neither were a match for the highest quality cigars desired by the truly discerning smoker, of course, and *truly* sophisticated gentlemen and ladies smoked pipes, as they do now and shall for all of human history owing to the objective superiority of the method.

There are some great anecdotes, for instance it's said that proponents of the mechanized methods falsely claimed that saliva was a key element of keeping hand-rolled cigars properly packed. At any rate, mechanically-produced cigars took up a larger and larger portion of the mass-produced cigar market, all the while losing substantial ground to cigarettes. Later on, the rise of the so-called "big tobacco" cigarette companies and the attendant advertising wars substantially decreased the cigar market and put the nail in the coffin of Florida's cigar industry. Today, Swisher is nearly all that remains of those early skirmishes.

Over the last 30 years there has been an increasing interest in smoking high quality cigars, resulting in increased demand for well-made hand rolled cigars. At the same time, there has been a nationwide crackdown on "tobacco" as a menace to public health. Swisher is caught in the middle of several lines of fire, unfortunately for its employees.

[urbanlibertarian]

Isn't it our government policy to eliminate tobacco farming and processing from the US?

[ChriswUfGator]

This is just more the inevitable result of all the ayn rand no-rules bow-down to global commerce nonsense. Import tariffs are actually a good thing from a comparatively rich country's perspective, they serve to prevent global wealth redistribution. Globalization, at least in the version we've sold it to the public in this country, really only works as advertised after most of the globe has reached relative wealth parity. Until then, it's just a game of exploiting cheap labor without passing the savings along to the user of the product. For us, this means a downgrade. But everybody in Washington's been drinking the kool-ade since the 1990s (because they're paid to drink it), and pointing out the obvious is probably a lost cause.