Costco’s High-Tech Meatpacking Plant Stays Open as Virus Shuts Migrant-Labor Plants

Workers process chickens at the Lincoln Premium Poultry plant, Costco Wholesale's dedicated poultry supplier, in Fremont, Neb., Thursday, Dec. 12, 2019. (AP Photo/Nati Harnik)
AP Photo/Nati Harnik

China’s Wuhan virus is spreading rapidly through the nation’s close-packed, labor-intensive, low-wage meatpacking sheds.

“We have basically a policy of lowering labor costs at all costs, and now we’re paying the price because we have all these labor-intensive industries that are paying dirt wages and putting their employees at risk,” said Rosemary Jenks, policy director at Numbers USA.

The good news, however, is found in Fremont, Nebraska, where Costco build a highly automated meatpacking plant in which two shifts of roughly 400 employees will produce two million chickens per day, mostly for West Coast customers of Costco’s $4.99 roasted chicken.

“The technology has enabled us to do a lot of things — use fewer people, and eliminate the harder jobs — and it has taken away some of the dissatisfaction that people have seen in [meatpacking] jobs,” said Jessica Kolterman, spokeswoman for Costco’s Lincoln Premium Poultry subsidiary.

The technology allows the workers to daily process 2,500 chickens per worker, easily allowing a starting wage of $15 an hour, plus health care and vacation benefits.

Costco bought much of the production technology from Marel, a firm in low-population, high-wage Iceland where engineers had to develop labor-saving machines to strip the expensive meat from fish and poultry.

Costco announced its first coronavirus case on April 13, reported:

FREMONT, NEB. – Lincoln Premium Poultry announced its first coronavirus (COVID-19) case on April 13. Jessica Kolterman, director of corporate and external affairs, said in a news release the employee who tested positive worked the 2nd processing shift in the evening which has fewer employees. She added the person did not interact with “many employees” their last day at the plant, which was April 8. Lincoln has arranged a deep clean of all areas and scheduled work will continue as normal.

The employee and two others who might have been exposed are self-isolating at home with pay.

The situation is far different in the labor-intensive meatpacking plants where employers are able to hire a no-union, powerless workforce of migrants and refugees and then work them hard for low wages until they accumulate injuries and quit.

In South Dakota, numerous migrants at a Chinese-owned meatpacking plant with 3,700 employees have fallen sick with the virus, the Sioux Falls Argus Leader reported on April 11:

As the number of Smithfield Foods workers with COVID-19 continues to rise, South Dakota Gov. Kristi Noem and Sioux Falls Mayor Paul TenHaken are calling on the meat packing plant to shut down for two weeks.

The state Department of Health said Saturday that 238 of the state’s 626 cases involve workers at the Sioux Falls pork processing facility, up from 190 cases among workers reported a day earlier.

We have interpreters actually in the emergency room full-time now and we have printed material in about six languages right now to hand out,” said David Flicek, president and CEO at Avera McKennan Hospital. “So that is a major concern with this specific population, making sure that we’re being clear and concise.

The New York Times reported April 12 that Smithfield agreed to temporarily close the South Dakota plant:

The closure of this facility, combined with a growing list of other protein plants that have shuttered across our industry, is pushing our country perilously close to the edge in terms of our meat supply,” [Kenneth M. Sullivan, president and chief executive of Smithfield Foods], said. “It is impossible to keep our grocery stores stocked if our plants are not running. These facility closures will also have severe, perhaps disastrous, repercussions for many in the supply chain, first and foremost our nation’s livestock farmers.”

At a Tyson Foods poultry plant in Georgia, three workers have recently died from the coronavirus, while the company halted operations at a pork plant in Iowa after more than two dozen workers tested positive.

JBS USA, the world’s largest meat processor, confirmed the death of one worker at a Colorado facility and shuttered a plant in Pennsylvania for two weeks. Cargill this week also closed a facility in Pennsylvania, where it produces steaks, ground beef and ground pork.

In Iowa, Tyson Foods’ pork meatpacking site in Columbus Junction closed after the disease hit 24 of the 1,400 employees.

In Fremont, however, Costco’s automated line is putting pressure on other meatpackers to raise their game, Fremont Mayor Scott Getzschman told Breitbart News. “It has raised the bar, and all the wages of the workforces have increased,” he said.

For example, another meatpacker in the town — WholeStone Farms — has announced plans to spend $200 million on upgrades to its pork processing facility, the mayor said. Some of the money will be used for employee amenities, such as a new restaurant, but the company is also planning to upgrade the processing lines. “The flow of the plant today isn’t as efficient as it could be; our new layout will allow for a more streamlined flow in our production practices,” Steve Weers, the meatpackers’ chief operations officer said in a statement.

The reduced inflow of cheap labor into the United States is forcing companies to invest in labor-saving machinery, according to an April 7 article at the Meat+Poultry website:

Scott Hazenbroek, president of Foodmate US Inc., based in Ground, Georgia, notes robotics and automation are the main trends in poultry technology due to their potential to reduce labor, which is a significant challenge for most clients.

“Machines are taking over the work, and it’s not a choice; it’s a necessity. Since the market is forced to automate, there are many machines available that are not meeting the same quality and results of a manually deboned piece of meat,” he explains. “We saw and seized the opportunity by building the most robust and efficient deboning systems on the market by introducing intelligent deboning machines.”

Foodmate recently developed a built-in X-ray measurement system in its whole leg and thigh deboners; it gathers data and makes real-time automatic adjustments to the size and weight variance that is inherent to a product like chicken.

President Donald Trump and his “Hire American” policies get some of the credit for the productivity upgrades and pay increases.

But business leaders are still touting lower costs instead of higher productivity and higher wages.

“The technology you see here is allowing American families to spend less of their food dollars or their disposable income on food than anywhere else in the developed world,” agriculture secretary Sonny Perdue — a former industry executive — said when he visited the Fremont plan in December 2019, according to a report in the Lincoln Journal Star. The report continued:

“It’s just a great ecosystem that develops,” Perdue said. “It allows us, the United States, to enjoy the lowest-cost food in all the developed world. It takes things like this to continue. This is cutting-edge.”

Fremont city officials work closely with Costco’s Lincoln Premium Poultry plant, said the mayor, which is on track to add $1.2 billion of annual payrolls, purchases, sales, and taxes into the community each year:

You could not have asked for a better partner in economic development. They have done exactly what they said they would do, and they continue to move the needle and to tamp up what they said they would do. We’re extremely excited to have them part of the community.

It has raised the bar [for other employers], and the wages of the workforce have increased. That’s a double-edged sword – it is good for the employees, but truly we need to find more people [for open] positions, so we’re still working to fill all those positions.

The city works with the slaughterhouses, even as it also urges companies not to hire illegal aliens, the mayor said. “That’s the biggest part of this process,” he said, adding that the Costo plan has not triggered “a huge influx of any population.”

Kolterman, the spokeswoman for Lincoln Premium Poultry, told Breitbart that roughly 25 percent of the workers at the poultry plant are “English speakers.” Sixty percent are “Spanish speakers,” including many who commute from outside Fremont, she said.

Since 2010, Fremont has a rule barring apartment rentals to illegal immigrants.

The local schools perform well in the state-wide rankings.

Business-backed pro-migration groups bitterly denounced the rule, saying it was racist and that it deterred business investment in the town. for example, Immigration Impact wrote in February 2014:

in 2010, new immigrant business owners brought $126 million in net business income into Nebraska. The same year, unauthorized immigrants in the state paid $43.3 million in state and local taxes according to data from the Institute for Taxation and Economic Policy.

Pressure from progressives and the establishment media has repeatedly helped meatpacking companies suppress widespread public opposition to the cheap-labor slaughterhouses and their associated poverty. In neighboring Iowa, for example, Marshalltown, Denison, and Storm Lake converted themselves into meatpacker towns where local workers have been displaced as the meatpackers, retailers, and landowners invited waves of legal and illegal migrant workers and renters.

In 2014, Fremont voters reaffirmed the housing rule despite the hateful rhetoric and lawsuits by pro-migration groups. NumbersUSA reported:

Voters in Fremont, Nebraska resoundingly defeated an attempt to repeal an ordinance that requires all renters to attest they have legal permission to live in the U.S. Unofficial election results show that the repeal attempt failed by a 60-40 margin.

The ordinance requires anyone who rents a home or apartment to apply for a $5 permit and attest to their legal status. Landlords are required to check whether their tenants have permits or face a $100 fine. The petition-driven ordinance originally passed in 2010 with 57 percent of the vote.

“Forty years ago, meatpacking was a good, paying job,” said Jenks. “It was a solid career path – and that all changed because employers are using immigrant labor,” including refugees and illegal immigrants, she said.

But with the rising pay in the Fremont meatpacking jobs, Mayor Getzschman told Breitbart News, the social status of slaughterhouse jobs “has become more acceptable.”


Please let us know if you're having issues with commenting.