Caterpillar will make 250-300 positions redundant at its manufacturing plant in South Milwaukee.
The company made the announcement just before the Easter weekend, citing disappointing earnings figures. It affects 40 per cent of its South Milwaukee workforce, according to WISN.
The Illinois-based company announced last week that cost-cutting in heavy mining equipment manufacturing had become necessary.
Analyst Mig Dobre from Robert W. Baird & Co said he was unsurprised.
“The difficulties in the mining space I think are widely known by now,” Dobre told The Business Journal. He pointed out that capital spending had been reduced for many of Caterpillar’s customers.
“That, along with quite a bit of uncertainty for miners with regards to which projects they’re going to expand and continue versus the ones that they’re going to cancel, has created a near-term environment that is quite difficult for all mining (original equipment manufacturers),” said Dobre.
The United Steelworkers union, which represents 800 workers at the facility, was unconvinced that the cuts were necessary, and has been claiming that Caterpillar is training “scabs” for potential strikes.
“Well, the question I guess I got for them, is if really the sales are slow, why are they spending money at MATC [Milwaukee Area Technical College] to train scabs, to train replacement workers if you're really that slow?" the union’s Russ Winklbauer told WISN.