Food Manufacturing Declining in Southeastern Idaho

For decades food manufacturing has been a critical source of employment and economic vitality in southeastern Idaho. Multiple generations have worked in this industry. However, recent trends show a clear decline in employment levels.

Historically, food manufacturing has been an economically resilient industry. “People always have to eat regardless of the economy” was the view, and southeastern Idaho has some of the best potatoes in the world. Many food manufacturers took advantage of the crop by locating large processing plants in the region.

Despite signs of an economic recovery nationally, the last several months regionally have seen some food manufacturing plants close and others lay off workers. The local economic impact will likely be severe.

Between 2007 and 2013 employment in food manufacturing declined 15 percent, or about 510 jobs. That does not include planned closures later this year by Heinz and Simplot, which will exacerbate the economic fallout.

Dan Chart
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The H.J. Heinz plant in Pocatello is a good example of the economic impact of industry. Heinz announced last fall it would close the plant, eliminating 410 jobs by summer’s end. Layoffs had already cut the workforce from the more than 800 at its peak in 2009.

A simulation by Economic Modeling Systems International estimates an additional 332 jobs will disappear in other sectors in Bannock, Bingham and Power counties.

Dan Table
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The closure of the J.R. Simplot potato processing plant in Aberdeen this spring will eliminate another 250 food processing jobs. While demand remains for Idaho potatoes, automation doomed the aging Aberdeen plant along with plants in Caldwell and Nampa, which are being replaced by a state-of-the-art plant in Caldwell that will run with just a third of the workforce.

Consolidation in the potato processing industry is another factor, which may lower employment levels in southeastern Idaho. Last year Nonpareil Foods sold a sizable portion of its potato processing operations in Blackfoot to Basic American Foods. The sale resulted in a loss of around 100 jobs.

Food manufacturing will still be an important provider of jobs in southeastern Idaho, but it may not provide new jobs in the future. The region’s economy will need opportunities in other industries to provide manufacturing jobs for its workers., regional economist
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