Eaton Corp. Closing Light Factory in Houston, Laying Off 52 Workers

Eaton Corporation Layoffs
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Eaton Corp Layoffs 52 Employees

The entire light factory owned by Eaton Corporation PLC (NYSE:ETN) in Houston, Texas will be shutting down. The resulting Eaton Corp layoffs will impact 52 employees.

The facilities focused on manufacturing LED lights used in the oil and petrochemical sector. The warehouse was also in the business of producing explosion-resistant lights.

The closing of the facility will lower the number of facilities located in Houston down to four. Damage to parts of the building due to flooding and Hurricane Harvey was not a factor in the decision. Rather, the warehouse closure was largely attributed to a tougher competitive environment in the lighting sector.

What Are the Company’s Plans for Employees?

There are presently approximately 1,200 employees that work in the Houston area at other plants owned by Eaton. Some light factory employees will be moving their workstations to one of these warehouses, but the number of such opportunities is limited, hence the Eaton Corp. layoffs.

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Other jobs from the lighting facility will be moving to the state of Virginia, China, and Mexico. The move is expected to begin in December and be completed by March.

The 52 individuals who have lost their jobs may also have a difficult time looking for new work, since manufacturing in Houston has seen more job cuts than growth.

What Does This Mean for the Other Houston Facilities?

This willingness to move jobs overseas indicates potential future Eaton Corp. layoffs. That’s because of the lower labor costs outside the U.S., meaning Eaton Corp. may see greater benefit in further outsourcing, especially since employee wages are typically the largest portion of operating costs.

What’s more, the company already has facilities located overseas, which could be a point of concern for those currently employed at one of the Houston locations.

 

Sources 

Eaton to close light factory, lay off 52 workers,” Chron, November 27, 2017.

While Dallas manufacturing thrives, Austin and Houston rank as nation’s worst,” Dallas Business Journal, August 11, 2017.

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