Thread: Swift's output recovers after raid

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Swift's output recovers after raid
The meat processor pumps up advertising in Marshalltown, but it doesn't increase wages.

By PAULA LAVIGNE
REGISTER STAFF WRITER


February 13, 2007
7 Comments



Swift & Co. says new applicants have come quickly to fill the jobs left by those detained in the Dec. 12 immigration raid.

The company's pork processing plants are back to normal production levels, company officials say. Their beef plants are at 70 percent of capacity but should rebound by May after the company finishes training new hires, Swift spokesman Sean McHugh said.

The U.S. Immigration and Customs Enforcement action at six Swift plants nationwide, including the plant in Marshalltown, resulted in a loss of 1,282 employees, about 10 percent of the company's work force.

"One side effect ... of all the widespread media coverage was the world figured out we were hiring," he said. "(With) our own efforts for advertising, it has worked quite well for applications."

In Marshalltown, the company increased advertising. It did not raise wages, McHugh said. The starting wage is $11.50 an hour. It was raised about $1.65 in the fall, before the raids.

Swift has not changed its hiring practices since the raids. The company continues to participate in a government pilot program to help weed out illegal immigrants by checking for discrepancies in Social Security numbers, McHugh said. Human resource workers receive special training in detecting fraudulent documents.

Even with that safeguard, which the company has been using for almost a decade, McHugh said flaws in the program allowed some new hires to skirt the system. Government rules restricted how far Swift officials could go in questioning their legitimacy. If the company goes too far in questioning someone's status, it risks being sued for discrimination, he said.

As an example, he said federal justice officials cited the company for $2.5 million in 2001 for "doing too much" to screen workers. The company settled for $200,000 two years later with no admission of guilt, he added. He said the company did not knowingly hire illegal workers.



The company took a financial hit from the raids, losing about $30 million, McHugh said. To put that in perspective, the company posted a pretax loss of about $183 million at the end of its last fiscal year in May and was near breaking even in November. Swift is a privately held company with publicly traded debt.

The company handles about 15 percent of the nation's beef processing and 11 percent of its pork. Although Swift controls a large chunk of the market, it's unlikely that the temporary lull in production caused by the raids hurt the overall industry, said Ron Gustafson, beef analyst and economist for the U.S. Department of Agriculture's Economic Research Service.

Output from all slaughtering plants was 3.86 billion pounds in December, which was a drop from November and was 2 percent less than in December 2005. A spate of bad weather in late fall likely contributed to that drop, Gustafson said. Even before the raids, production levels were less than the industry's overall capacity, he said.

"For some individuals, (the raids) probably did have an impact," he said. "But for the overall market it was fairly minimal and would be difficult to separate out from weather conditions and seasonal holiday patterns."

Gustafson said it was too early to tell whether the raids would have a long-term impact on hiring for the plants, adding that "it's always difficult to get workers."

With a 35 percent to 40 percent annual turnover, Swift needs about 5,000 to 6,000 new hires each year, McHugh said.

The Marshalltown plant has a referral bonus incentive in which existing employees receive up to $1,500 for recruiting an experienced worker and $650 for recruiting a worker without plant skills. That incentive program was in place before the raid.



The investigation by Immigrations and Customs Enforcement that led to the December raids began a year ago, said Pat Reilly, customs' spokeswoman. Swift was aware last March when immigration officials requested employees' application forms, McHugh said. Immigration officials also were working undercover in the plants, but Reilly would not say how long they had been there.

The federal government has not taken any action against Swift. Reilly said the investigation is continuing.

"We will certainly look at Swift's hiring practices and see whether they did what was incumbent on them as an employer to verify their employees are able to work," she said.

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Comments being left after the article also.

Swift says that workers leave and new workers have to be hired all the time. Maybe Swift needs to look at why workers leave. Americans have bad jobs and have stayed with them, but something is wrong that Swift things that people are going to leave a job that starts at $11 with benefits. Does Swift give cost of living raises? Does Swift provide benefits?

Ok, how many of us think that since the government was in communication with Swift about the impending raids that maybe the company raised the wages in anticipation of having to hire actual AMERICANS at decent wages??...if $11 an hour can be called decent in an industry that paid $19 an hour twenty years ago.

And what about that incentive program? Put in place to cover the illegals they thought might be caught working there when they were raided? Has anyone seen the cost of beef or pork go down in the twenty years since they started giving our jobs to illegals at less than half the wages Americans used to get?

Kinda makes you wonder what happened to all that profit...ok, I'm going to be sick now.