John Deere, the agricultural machinery giant, has eliminated over 4,500 Iowa jobs since 2015, including nearly 200 terminations on January 3, 2025.
This unprecedented downsizing marks the largest in the company’s Iowa history, even as John Deere projects earnings of over $5 billion in fiscal 2025. The stark contrast between profits and layoffs raises key questions about corporate priorities.
Economic Pressures: The Struggling Farm Economy
The driving force behind John Deere’s decision to cut jobs is a plummeting demand for farm equipment. With corn prices down 37%, soybeans by 24%, and wheat falling 35%, farmers’ orders have sharply declined.
WARN notices reveal cuts across several Iowa factories, including 75 at Ottumwa and 141 at Waterloo/Ankeny.
Immediate Hardship for Iowa Workers
On January 3, 2025, nearly 200 Iowa workers received the news of their job cuts. Ottumwa, Waterloo, Ankeny, Davenport, and Dubuque — towns heavily dependent on Deere — are facing immediate challenges.
As loyalty and dedication are weighed against spreadsheets, families scramble to adjust their finances, and local tax bases start to erode.
Salaried Employees Also Affected
In addition to factory layoffs, John Deere has eliminated 410 salaried positions at Davenport and Dubuque Works, with over 230 more impacted in subsequent rounds.
Meanwhile, CEO John May earned $26.7 million in 2023, despite the company facing “challenging market conditions.” These actions have ignited debates over corporate ethics and executive compensation.
Mexico Shift Fuels U.S. Job Losses
As part of its restructuring, John Deere has relocated $55 million worth of operations from Iowa to Mexico.
This includes the production of skid steer loaders, with the shift expected to be complete by 2026. The decision to offload production to Mexico has sparked political debates, particularly around the impact on U.S. jobs.
Farmers Scale Back Equipment Purchases
A key driver of Deere’s cost-cutting measures is the delayed purchase of agricultural equipment. Due to lower commodity prices, farmers are scaling back investments in machinery.
As USDA projections for 2023 and 2024 suggest a decline in row-crop receipts, many Iowa farmers are postponing upgrades, affecting Deere’s order volumes.
The Human Toll: Voices from the Factory Floor
For the workers at Waterloo Tractor Operations and Davenport, the layoffs have been devastating. “Optimization” may be the corporate narrative, but for employees, it feels like a betrayal.
Many workers who had built their careers with the company are now left struggling to find a sense of security in a rapidly changing landscape.
Trump Tariffs Add to the Strain
In 2024, President Donald Trump proposed 200% tariffs on Mexico-made John Deere equipment. This threat, combined with the already significant production shift, is expected to cost Deere $600 million in 2025, with potential losses growing to $1.2 billion by 2026.
These figures add another layer of complexity to the company’s financial outlook.
Economic Ripple Effects Across the Ag Sector
John Deere’s layoffs are part of a larger trend of weakening farm incomes, impacting not only Deere but also suppliers in the agricultural sector.
Local businesses in areas like Davenport and Dubuque are facing slowdowns, as fewer people are purchasing agricultural inputs like fertilizer and seeds.
Retailers Brace for Prolonged Low Demand
Ag retailers in Iowa are adjusting to the new economic reality by discounting inventory, fearing that low demand will continue.
This shift, driven by reduced farm equipment orders, has led to layoffs among Deere’s parts dealers, particularly in areas like Waterloo, where job cuts are expected to continue into 2025.
Hospitality Industry Feels the Pinch
Iowa’s small towns, such as Ankeny, are seeing a noticeable drop in restaurant and motel bookings. With laid-off workers cutting back on spending, local businesses are struggling.
Ottumwa’s 75 job cuts have particularly hit the hospitality sector hard, as foot traffic drops by nearly 20%, deepening the community’s economic struggles.
Fertilizer and Parts Manufacturers Also Affected
As John Deere scales back production, its suppliers in Iowa — particularly those producing components like engines and drive trains — are experiencing a ripple effect.
The slowdown at Deere’s Waterloo plant has caused delays in the steel, rubber, and component supply chains, further exacerbating the economic downturn in the region.
Mexico Gains Market Share Amid U.S. Cuts
John Deere’s shift to Mexico has caught the attention of global farmers, especially those in Brazil and Europe.
As Deere faces tariff pressures in the U.S., international competitors are gaining ground. The $55 million move to Mexico is part of a broader trend where U.S. manufacturers increasingly seek lower labor costs abroad.
Health Struggles in Rural Iowa
The impact of Deere’s layoffs is felt not just economically, but also in the health of affected workers. Many laid-off employees are delaying healthcare despite receiving six months of benefits.
In communities like Davenport, the mental health burden is growing, with calls for more state support to help those facing job loss.
Environmental Conversations Sparked by Mexico Move
The relocation of operations to Mexico has also sparked discussions about sustainability. While U.S. emissions may decrease due to idle plants, the environmental cost of transporting goods from Mexico could offset these benefits.
Additionally, the farm economy’s challenges have delayed the adoption of precision agriculture, further hindering sustainability efforts in Iowa.
Local Governments Feel the Strain
Iowa’s local governments are bearing the brunt of the job cuts. As tax bases shrink, communities like Ottumwa and Dubuque face challenges in funding public services.
Schools and other essential services are strained, while the investment flowing into Mexico offers little benefit to Iowa’s already struggling towns.
Deere Stock Shows Volatility Amid Layoffs
Investors are closely watching John Deere’s stock performance, particularly as the company reports a projected $5.027 billion in earnings for fiscal 2025.
Despite layoffs and tariff concerns, Deere’s stock has shown resilience, buoyed by bets on a potential ag recovery. However, the company’s profitability continues to face significant uncertainty.
What Farmers Need to Know
Farmers are advised to delay non-essential equipment purchases and consider used gear from Deere’s idled lines. As layoffs impact Deere’s production, farmers may find better deals on previously owned equipment.
Additionally, farmers should review recall rights and explore diversifying crops to cushion against volatile commodity prices.
What’s Next for Deere?
By the end of 2026, Deere will have fully shifted skid steer production from Dubuque to Mexico. Although tariff pressures may increase costs, a potential recovery in the farm economy could lead to a rebound.
John Deere will likely continue its “optimization” strategy, looking for ways to balance profitability with demand fluctuations.
Iowa’s Economic Future in Flux
As John Deere’s cuts ripple through Iowa’s economy, questions remain about the long-term impact on local communities.
While Deere remains profitable, the loss of 4,500+ jobs, plus ongoing shifts to Mexico, exposes vulnerabilities in Iowa’s manufacturing heartland. These events urge policymakers to address the systemic issues facing workers and rural economies.
Sources:
“John Deere has cut more than 4500 jobs since 2015.” Investigate Midwest, 14 Jan 2025.
“Deere Reports Net Income of $1.065 Billion for Fourth Quarter, $5.027 Billion for Fiscal Year 2025.” Deere & Company Official News Release, 25 Nov 2025.
“John Deere confirms US $55M investment in Mexico plant despite Trump’s tariff threats.” Mexico News Daily, 25 Nov 2024.
“Trump threatens John Deere with 200% tariffs if production moves to Mexico.” Reuters, 23 Sep 2024.