Home-bound Americans may be spending more time in their La-Z-Boy recliners, but the company that makes La-Z-Boy chairs and furniture is cutting 850 jobs to streamline its operations amid the slowing U.S. economy this year.
La-Z-Boy said it is laying off about 10% of its global workforce and closing a 60-year-old factory in Newton, Mississippi to help respond to the slowdown in sales due to the coronavirus and to rightsize the company for the long term. Production from the Mississippi plant will be shifted to available capacity at the company’s biggest plant in Dayton, Tennessee, along with La-Z-Boy’s other factories in Neosho, Missouri and Siloam Springs, Arkansas.
La-Z-Boy CEO Kurt L. Darrow said the coronavirus has “had a far-reaching impact” on the company, forcing a shutdown of production in March, the closing of retail stores and the implementation of new processes for restarting its furniture making operations in late April.
“It is now appropriate to leverage the efficiencies we have created across the company and right size our business for the long term given the impact of COVID-19 on the state of the economy, with wide-sweeping unemployment levels and the uncertain timing of a full economic recovery,” Darrow said in an announcement of the layoffs. “These are difficult decisions to make and we deeply regret the impact they will have on those employees who are affected.”
La-Z-Boy will continue to operate about 4.5 million square feet of manufacturing space and Darrow said he is confident “we will emerge from the crisis with strength and remain a leader in the industry.”