Midland-based Dow Chemical to shed 6% of workforce amid coronavirus challenges
FLINT, Mich. (WJRT) (07/23/2020)-The coronavirus pandemic continues to take a toll on US manufacturers. Even though Dow's latest numbers weren't as bad as investors worried they might be, the company's still taking the cue to downsize.
Midland-based Dow Chemical, announcing it would shed a full six percent of its workforce following a disappointing second quarter. Uncertainty amid the COVID threat has dealt US manufacturers a devastating blow, one which makes it increasingly difficult to predict future demand.
In that second quarter earnings report – Dow touts early financial interventions as having left it better insulated than most. Though earnings exceeded the $8-billion investors expected coming in at $8.4-billion, revenue still tanked around 25 percent year over year, prompting the company to reevaluate.
CEO Jim Fitterling summed up those challenges in a Thursday statement: “Based on what we’ve seen in the second quarter and into July, we continue to expect a gradual and uneven recovery and, therefore, remain intensely focused on the actions within our control and maximizing our operational advantages.”
Dow Chemical is one of the nation’s largest employers – with more than 36-thousand workers on its payroll. An economic lynchpin also for the Great Lakes Bay Region in particular, employing around 5,000 Michiganders.
The operations targeted for workforce reductions – including any local facilities -- weren’t specifically named. A Dow spokesperson tells ABC 12: “Workforce reductions will vary by business, function and geography.” They add we’ll likely know more regarding that specific, local impact by the end of the quarter.
The company, meanwhile, is ramping up expense reduction plans, which increased from $350-million to $500-million in cost cutting strategies. It comes weeks after Dow finalized the sale of its rail infrastructure assets at six sites across North America, which should net more than $300-million by year’s end.
ABC 12 also reached out to the union representing some of Dow’s workers but hasn’t heard back. Count on ABC 12 to continue to follow this developing story.
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