Nearly A Year After Layoffs, Former Oreo Plant Workers Struggle To Find Their Way

By Greg Trotter
Chicago Tribune

WWR Article Summary (tl;dr) It’s been nearly a year since Mondelez laid off almost half of its 1,200 manufacturing workers in Chicago, shifting the work to Mexico. More than 100 employees have been called back, but many of those who lost their jobs struggle to stay afloat financially.


Susana Palomo couldn’t sleep for a week, torn between a dream and reality.

One of the hundreds of workers laid off last year from a Nabisco plant on Chicago’s Southwest Side, where Oreos were made for more than six decades, Palomo had embarked on a bold plan to attend college and perhaps open her own small bakery someday. But Mondelez International, the $30 billion global parent company of Nabisco, called her back to work in December.

Palomo’s dilemma: Return to the factory job and get paid? Or continue studying at the French Pastry School, where she was thriving?

“I know money is really important in life, but other things also. If you’re not happy, money’s not everything. … It’s a struggle,” said Palomo, a woman in her 50s who emigrated from Mexico with her family as a teenager.

It’s been nearly a year since Mondelez laid off almost half of its 1,200 manufacturing workers in Chicago, shifting the work to Mexico. More than 100 employees have been called back, but many of those who lost their jobs struggle to stay afloat financially.

The layoffs, continuing the trend of American companies exporting jobs to take advantage of cheaper materials and labor costs, prompted both Donald Trump and Hillary Clinton to lambaste Mondelez’s decision from the campaign trail. Since taking office, Trump has repeatedly pledged to restore U.S. manufacturing jobs lost to other countries.

But it’s hard to envision a meaningful reversal of the manufacturing decline in Chicago, where $25-an-hour factory jobs with benefits have become increasingly rare. In the late 1940s, Chicago boasted almost 670,000 manufacturing jobs, according to city data. Recent estimates by university researchers put the current number at closer to 70,000.

Jobs at the Nabisco bakery, which employed more than 4,000 workers in its heyday, generally paid more than most of the other jobs in the surrounding area, and the plant employed more black and Latino workers than other facilities in the area, according to a recent analysis by the Great Cities Institute at University of Illinois Chicago.

“These are important, good-paying jobs, and not necessarily for people with high levels of educational attainment, in a part of the city that’s been losing manufacturing jobs for decades,” said Matt Wilson, economic development planner for the Great Cities Institute.

Since the 600 job cuts were announced in July 2015, 429 workers have received layoff notices, said Mondelez spokeswoman Laurie Guzzinati. Retirements and attrition helped offset some layoffs.

Of those 429, 120 have returned to the facility after being called back to work and there could be additional callbacks, Guzzinati said. More could be called back depending on operational needs, she said.

After Anthony Jackson was laid off in March, his apartment stayed dark for almost a month because he couldn’t pay the electric bill. He fell behind on child support payments for his three daughters. He had to make a hardship withdrawal from his 401(k).

“Originally, it was harsh. It was extremely harsh,” said Jackson, 40, a Navy veteran who worked about five years at the plant.

His fortunes improved when he became a paid advocate for the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, by far the largest union at the plant.

Since June, Jackson said he’s spoken to college students and labor groups in 19 states, promoting the union’s boycott of Mexican-made Nabisco products and calling for the “repatriation of American jobs.”

Jackson wouldn’t say how much the union pays him, although he said it’s considerably less than the $26 an hour he made at Mondelez. But he believes in the cause and takes satisfaction in the work.

“I live in a bad neighborhood. I see the unemployment here. … I think it’s incumbent for me and my family and those around me to fight to try to change that,” Jackson said.

Michael Smith also joined the baker union’s fight. Smith, a 59-year-old, had hoped to retire from the Mondelez plant, but has found a new calling as a voice of the union after he was laid off in March.

Unafraid of public speaking, Smith recently delivered a speech to some 3,500 members of the American Postal Workers Union in Florida.

Like Jackson, Smith speaks passionately about what he considers to be the injustice of a company moving American jobs to Mexico and selling products back to American consumers in order to increase profits for shareholders.

If recalled to the plant, Jackson said it would be a “tough decision” on whether to return. Smith said he’d happily get back to work.

“I’m really hoping there’s a great possibility that Mondelez will at least call me back,” Smith said.

After getting called back by Mondelez, Palomo returned in December, for one day.

That’s all it took for her to realize she was done with factory work.

While she worked for more than 25 years in Chicago-area factories, Palomo longed for a better life for her two daughters.

She decided to pursue the dream she kept for herself. In August, she enrolled at the French Pastry School, where she learned to bake layered wedding cakes adorned with intricate gum-paste flowers that looked real enough to smell.

Money’s tight. Her husband, Pete, also a longtime factory worker now working at a Dean’s Dip plant outside the city, is now the family’s only source of income. Household spending has been reined in; needed home repairs have been deferred.

But she has some help. Because the jobs were shifted to Mexico, Palomo and others were able to apply for federal assistance for training through the Trade Adjustment Assistance for Workers program. In 2016, more than 4,900 workers in Illinois were covered by the program, up from 3,235 the year before.

Her husband and grown daughters, Ashley and LizMarie, support her decision.

“To be honest, my mom’s spent her whole life sacrificing what she wants to do for what she’s supposed to do,” said LizMarie Palomo, 26, a DePaul University graduate who works at a Chicago marketing firm.

“Seeing her take on something so new and so different shows me that life will always have new chapters, something new to take on. I’m really, really proud.”

Susana Palomo still lies awake some nights worrying about money, and after her June graduation, she’ll have to find a job. But she feels she made the right decision.

“It’s going to be a little tough. I’m not young anymore. But everything is going to be OK,” Palomo said. “We have each other.”

Last summer, the last Oreos rolled off the line at the Nabisco facility, ending a run that dates back to 1953. Oreos are still made in several other U.S. facilities, in addition to Mexico.

Mondelez has defended its decision as important to its ability to compete in a global marketplace. Installing the new production lines in Salinas, Mexico, instead of upgrading the Chicago plant, saves the company about $46 million a year, executives have said.

The average worker at the plant in Mexico makes total compensation, including a base wage and the value of benefits, that’s equivalent to $7 an hour, which is a competitive salary for that region, said Mondelez’s Guzzinati.

The Chicago facility, which continues to produce products like BelVita biscuits and Mini Chips Ahoy cookies, will remain important to its North American supply chain, Guzzinati said.

For those called back to the plant, uncertainty lingers.

Members of the bakers union at the Chicago facility and other plants in the U.S. have worked without a contract since March 1, and negotiations stalled out in early April. Each side accuses the other of walking away from the bargaining table.

“It’s not right. There’s no job security. You’re working day to day and have no idea if you’re going to be laid off again,” said LaDonna DeGolyer, 57, who was laid off in March after seven years but called back in August.

Despite the uncertainty, DeGolyer said it was an easy decision to return to Mondelez. When she was laid off from Kraft’s Kool-Aid factory in Chicago, where she made about $23 an hour, it took her five years to find a comparable-paying job as a forklift driver at Mondelez, where she makes about $26 an hour, she said.

After losing her job, she couldn’t pay her daughter Kayla’s tuition at Eastern Illinois University, which led to a delay in Kayla finishing her sophomore year of college. DeGolyer said the financial stress also contributed to a swift decline in her own health. She lost her hair and continues to struggle with headaches and depression.

Back at Mondelez, she feels the toll of the layoffs on a daily basis.

“It was a happy thing (being called back to work), but also a sad thing, because less than half the people you used to work with are still there. You walk through and it’s like a ghost town,” DeGolyer said.

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