GRAND RAPIDS, Mich. (WOOD) — Over the past few weeks, multiple companies across West Michigan have laid off hundreds of employees, including Pfizer in Kalamazoo and LG Energy Solution in Holland.
Paul Isely, an Associate Dean & Professor of Economics at Grand Valley State University explained how the recent layoffs can affect the economy.
“The LG Plant is really about the fact that, as a result of a decrease in demand for EVs, and quite frankly, the strikes that happened,” he said. “The deployment of new EVs has been stretched out a little bit further, and so they have time to do some of the expansion they wanted to now, and as a result, they’re taking a line off.”
In a statement to News 8, LG Energy Solution said it was “transitioning and retooling some production lines” as is prepares to open its new expansions and that meant fewer staff was needed. It said the 170 layoffs would happen in phases between December and January.
“As we continue our mass expansion and renovations, LG Energy Solution Michigan is transitioning and retooling some production lines from our current production facility to our second factory within our Holland site. Less staff will be needed as some production lines are transitioned.
“Due to this production gap and automakers realigning the speed of the EV transition, it is with deep regret that we must unfortunately announce layoffs in Holland. The layoffs will occur in phases. Approximately 170 production team members will be laid off between December 2023 and January 2024. We will continue to remain open and transparent with our workforce as this process unfolds.
“We understand the impact this will have on those who are being laid off and will provide those affected with support and assistance. This will include a severance package and outplacement services.
“LG Energy Solution continues to grow and has a bright future in the automotive industry. The major expansion project for our second facility is well underway. And, with the recent partnership announcement with Toyota, we will supply batteries to all five top global automakers.”LG Energy Solution
News 8 asked Isely his thoughts on recent Pfizer layoffs.
“They’re doing that because there hasn’t been as much demand for COVID shots as what they had expected,” he explained. “It really was getting done with the third quarter, seeing where they were at, and saying, we have to make adjustments to our entire business plan.”
Isely predicts both communities will lose around $10 million because of the layoffs. He also predicts even more layoffs throughout other companies could become a possibility.
“The overall economy is slowing down right now, so we’ve seen that, we’ve seen retail prices starting to drop, we’ve seen people’s savings go down, we’re seeing consumers with stress,” said Isely.