By Cindy Gonzalez | Nebraska Examiner
LINCOLN — With Tyson Foods weeks away from shuttering its Lexington beef plant, the anticipated financial blow to the state is becoming clearer. Meanwhile, some workers have made strides to adjust.
The statewide economic loss, including both direct and ripple effects, is estimated at $3.28 billion a year, according to a recently released University of Nebraska-Lincoln analysis.
While public documents reported that a “mass layoff” of 3,212 Tyson workers will occur “on or around” Jan. 20, the UNL study projects more than 7,000 jobs will be lost statewide, along with an annual labor income loss of $530 million. That higher job loss count includes employees in other industries that support the Tyson beef plant operation and its workforce.
Tax revenues also will drop with the exit of Lexington’s largest employer. The projected annual decline in state personal income tax revenue is estimated at $23.2 million, according to the Dec. 22 report, and state sales tax proceeds are predicted to slide by $10 million a year.
Dawson County and neighboring communities will feel a concentrated punch, say authors and economics professors Elliott Dennis and Eric Thompson. Dennis specializes in livestock and risk management in UNL’s Department of Agricultural Economics. Thompson is an economist and director of the UNL Bureau of Business Research.
According to their analysis, local sales tax revenues in Dawson County will likely fall by $2.77 million a year due to the plant folding. Tyson has said that certain wind-down activities may continue for a short time beyond the Jan. 20 date.
Thompson called the Tyson plant closure significant statewide, saying he hasn’t seen many local employers “of this scale” close shop in the past few decades. The UNL analysis said the Lexington plant could process nearly 5,000 cattle daily, about 4.8% of total daily U.S. beef slaughter. It said the plant’s demise marks the first time one of the “Big Four” meatpacking companies has permanently closed a major facility during the current cattle supply crunch.
Still, Thompson said, such an occurrence in a market economy is not unnatural.
“The state needs to really focus on getting new investment,” he said.
Norfolk plant still empty
Nebraska Gov. Jim Pillen has said that Tyson officials were exploring options for the Lexington facility that include repurposing it into a “value-added” ag operation. Tyson has not announced any plan.
U.S. Rep. Mike Flood, R-Neb, has lamented publicly that Tyson about 20 years ago “pulled out” of his hometown of Norfolk, eliminating 1,300 jobs at the company’s stripped and now-abandoned meatpacking facility there, and the property has yet to be repurposed.
Since Tyson announced the Lexington plant closure on Nov. 21, Pillen has said that more than 1,600 people attended job fairs and other events designed to connect displaced workers with potential jobs and state workforce support services. More events are scheduled.
An hour drive from Lexington, the recently opened Sustainable Beef meatpacking plant in North Platte is hiring about 100 more workers and raising its daily cattle processing goal as a result of Tyson’s Lexington announcement, the North Platte Telegraph and Wall Street Journal have reported.
Lexington-area Tyson workers were inquiring about jobs immediately after Arkansas-based Tyson announced the closure. Sustainable Beef CEO David Briggs told the Telegraph that about 400 former Tyson workers already had joined his workforce, some before and some after the Nov. 21 announcement.
Today, the North Platte plant reportedly aims for 1,000 employees and to process 1,800 head of cattle per day.
Rancher-owned Sustainable Beef opened its plant in 2025 and was expected to create a more competitive supply chain against the “Big Four” producers. The four, Tyson, JBS, Cargill and National Beef, control about 83-85% of U.S. beef processing capacity, which, Dennis said, has long been a point of concern for cattle producers regarding market power and price.
For the Dec. 22 economic impact report, the UNL economists drew upon multiple data sources and used the IMpact analysis for PLANing (IMPLAN) model, a tool they described as an industry standard.