Levi Strauss has a bad case of the blues. On Feb. 22, the company announced plans to cut 30% of the 19,900 workers it employs in the U.S. and Canada and shut half its factories. The jobs will move overseas. Levi's pays U.S. textile workers more than $9 an hour with benefits. But with revenues off 13% in '98, the company says it can't afford that. The move means that Levi's, long famous for its social responsibility, is abandoning 150 years of mostly domestic production.
Chief Executive Robert Haas, who spent the days after the announcement talking with displaced workers, wasn't available for comment. The company is setting aside $245 million for severance payments, and Haas's Levi Strauss Foundation will add $5 million to the $8 million community-aid fund begun when Levi's slashed 6,395 jobs last year. At this rate, the total job loss from 1997 to the end of 1999 will be 12,000. "This country is over-denimed, and Levi's doesn't have the heat of a Calvin Klein," says J'Amy Owens of The Retail Group.