Who’s to Blame for a Factory Shutdown: A Company, or California?



VERNON, Calif. — Teresa Robles begins her shift around dawn most days at a pork processing plant in an industrial corridor four miles south of downtown Los Angeles. She spends eight hours on her feet cutting tripe, a repetitive motion that has given her constant joint pain, but also a $17.85-an-hour income that supports her family.

So in early June, when whispers began among the 1,800 workers that the facility would soon shut down, Ms. Robles, 57, hoped they were only rumors.

“But it was true,” she said somberly at the end of a recent shift, “and now each day inches a little closer to my last day.”  

The 436,000-square-foot factory, with roots dating back nearly a century, is scheduled to close early next year. Its Virginia-based owner, Smithfield Foods, says it will be cheaper to supply the region from factories in the Midwest than to continue operations here.

“Unfortunately, the escalating costs of doing business in California required this decision,” said Shane Smith, the chief executive of Smithfield, citing utility rates and a voter-approved law regulating how pigs can be housed.

Workers and company officials see a larger economic lesson in the impending shutdown. They just differ on what it is. To Ms. Robles, it is evidence that despite years of often perilous work, “we are just disposable to them.” For the meatpacker, it is a case of politics and regulation trumping commerce.

The cost of doing business in California is a longtime point of contention. It was cited last year when Tesla, the electric-vehicle maker that has been a Silicon Valley success story, announced that it was moving its headquarters to Texas. “There’s a limit to how big you can scale in the Bay Area,” said Elon Musk, Tesla’s chief executive, mentioning housing prices and long commutes.

As with many economic arguments, this one can take on a partisan hue.

Around the time of Tesla’s exit, a report by the conservative-leaning Hoover Institution at Stanford University found that California-based companies were leaving at an accelerating rate. In the first six months of last year, 74 headquarters relocated from California, according to the report. In 2020, the report found, 62 companies were known to have relocated.

Dee Dee Myers, a senior adviser to Gov. Gavin Newsom, a Democrat, counters by pointing to California’s continued economic growth.

“Every time this narrative comes up, it’s consistently disproven by the facts,” said Ms. Myers, director of the Governor’s Office of Business and Economic Development. The nation’s gross domestic product grew at an annual pace of 2 percent over a five-year period through 2021, according to Ms. Myers’s office, while California’s grew by 3.7 percent. The state is still the country’s tech capital.

Still, manufacturing has declined more rapidly in California than in the nation as a whole. Since 1990, the state has lost a third of its factory jobs — it now has roughly 1.3 million, according to the Bureau of Labor Statistics — compared with a 28 percent decline nationwide.

The Smithfield plant is an icon of California’s industrial heyday. In 1931, Barney and Francis Clougherty, brothers who grew up in Los Angeles and the sons of Irish immigrants, started a meatpacking business that soon settled in Vernon. Their company, later branded as Farmer John, became a household name in Southern California, recognized for producing the beloved Dodger Dog and al pastor that sizzled at backyard cookouts. During World War II, the company supplied rations to U.S. troops in the Pacific.

Almost 20 years later, Les Grimes, a Hollywood set painter, was commissioned to create a mural at the plant, transforming a bland industrial structure into a pastoral landscape where young children chased cherubic-looking pigs. It became a sightseeing destination.

More recently, it has also been a symbol of the state’s social and political turbulence.

In explaining Smithfield’s decision to close the plant, Mr. Smith, the chief executive, and other company officials have pointed to a 2018 statewide ballot measure, Proposition 12, which requires that pork sold in the state come from breeding pigs housed in spaces that allow them to move more freely.

The measure is not yet being enforced and faces a challenge before the U.S. Supreme Court this fall. If it is not overturned, the law will apply even to meat packed outside the state — the way Smithfield now plans to supply the local market — but company officials say that in any case, its passage reflects a climate inhospitable to pork production in California.

Passions have sometimes run high outside the plant as animal rights activists have condemned the confinement and treatment of the pigs being slaughtered inside. Protesters have serenaded and provided water to pigs whose snouts stuck out of slats in arriving trucks.

In addition to its objections to Proposition 12, Smithfield maintains that the cost of utilities is nearly four times as high per head to produce pork in California as at the company’s 45 other plants around the country, though it declined to say how it arrived at that estimate.

John Grant, president of the United Food and Commercial Workers Local 770, which represents Ms. Robles and other workers at the plant, said Smithfield announced the closing just as the sides were to begin negotiating a new contract.

“A total gut punch and, frankly, a shock,” said Mr. Grant, who worked at the plant in the 1970s. 

He said wage increases were a priority for the union going into negotiations. The company has offered a $7,500 bonus to employees who stay through the closing and has raised the hourly wage, previously $19.10 at the top of the scale, to $23.10. (The rate at the company’s unionized Midwest plants is still a bit higher.)

But Mr. Grant said the factory shutdown was an affront to his members, who toiled through the pandemic as essential workers. Smithfield was fined nearly $60,000 by California regulators in 2020 for failing to take adequate measures to protect workers from contracting coronavirus.

“After all that the employees have done throughout the pandemic, they’re now all of a sudden going to flee? They’re destroying lives,” said Mr. Grant, adding that the union is working to find new jobs for workers and hopes to help find a buyer for the plant.

Karen Chapple, a professor of city and regional planning at the University of California, Berkeley, said the closing was an example of “the larger trend of deindustrialization” in areas like Los Angeles. “It probably doesn’t make sense to be here from an efficiency perspective,” she said. “It’s the tail end of a long exodus.”

Indeed, the number of food manufacturing jobs in Los Angeles County has declined 6 percent since 2017, according to state data.  

And as those jobs are shed, workers like Ms. Robles wonder what will come next.

More than 80 percent of the employees at the Smithfield plant are Latino — a mix of immigrants and first-generation native-born. Most are older than 50. The security and benefits have kept people in their jobs, union leaders say, but the nature of the labor has made it hard to recruit younger workers who have better alternatives.

On a recent overcast morning, the air in Vernon was thick with the smell of ammonia. Workers wearing surgical masks and carrying goggles and helmets walked into the plant. The sound of forklifts hummed beyond a high fence.

Massive warehouses line the streets in the area. Some sit vacant; others produce wholesale local baked goods and candies.

Ms. Robles started at the Smithfield plant four years ago. For more than two decades she owned a small business selling produce in downtown Los Angeles. She loved her work, but when her brother died in 2018, she needed money to honor his wish to have his body sent from Southern California to Colima, Mexico, their hometown. She sold the business for a couple of thousand dollars, then started at the factory, making $14 an hour.

“I was proud,” she said, recalling the early months at her new job.

Ms. Robles is the sole provider for her family. Her husband has several health complications, including surviving a heart attack in recent months, so she now shoulders the $2,000 mortgage payment for their home in the Watts neighborhood of Los Angeles. Sometimes her 20-year-old son, who recently started working at the plant, helps with expenses.

“But this is my responsibility — it is on me to provide,” she said.

Ms. Robles has long recited the Lord’s Prayer every night before bed, and now she often finds herself repeating it throughout the day for strength.

“They’re kicking us out with no answers,” she said.

Other workers, like Mario Melendez, 67, who has worked at the plant for a decade, shares that unmoored feeling.

It’s an honor to know his labor helps feed people across Southern California, he said — especially around the holidays, when the factory’s ribs, ham and hot dogs will be part of people’s celebrations.

But the factory is also a place where he contracted coronavirus, which he passed along to his brother, who died of the virus, as did his mother. He was devastated.

“A terrible shock,” said Mr. Melendez, who says he feels betrayed by the company.

So does Leo Velasquez.

He started on the night shift in 1990, making $7 an hour to package and seal bacon. A few years later, he moved to days, working 10-hour shifts.

“I’ve given my life to this place,” said Mr. Velasquez, 62.

Over the years, his body began to wear down. In 2014, he had shoulder replacement surgery. Still, he had hoped to continue at the factory until he was ready to retire.

“That’s not going to happen,” he said. “Where I go from here, I do not know.”


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