Wal-Mart shutters Ohio optical lab lays off 650 employees

30 March 2009

The world's largest the largest private employer, Wal-Mart, which earlier this month reported a higher than expected quarter earning and said it would add over 30,000 jobs in the US and as many overseas (See: Wal-Mart creates 63,000 jobs; sales up 2.8 per cent) . said that it will close its South Side optical lab in Ohio and lay off 650 workers and shift its operations to Indiana, Texas and Arkansas.

The Ohio lab processes eyewear orders for the vision centres for Wal-Mart stores in the US. Recently the retailer announced that it would sharply reduce the cost of what customers pay for both contact lenses and youth eyewear that would help Americans save as much as 12 to 50 per cent on the costs of a yearly supply of contact lenses.

This 650 job cuts will be the biggest in Ohio since the beginning of the current recession. The retailer said that all the axed employees will receive regular paychecks and benefits for the next 60 days and will be eligible for positions at nearby Wal-Mart stores and Sam's Clubs. They will receive a severance benefit and all the sacked employees can also avail of the opportunity to receive outplacement services.

The company said that, henceforth all orders sent to the Ohio lab will be dispersed to labs in Crawfordsville at Indiana, Fayetteville at Arkansas and Dallas, thereby adding 100 more jobs.

"This decision along with expansions and improvements to our other eyewear manufacturing facilities will allow Wal-Mart to reduce costs and operate our optical business more efficiently," Volker Heimeshoff, divisional manager of health and wellness for Wal-Mart US, said in the statement.

But by closing this lab, Wal-Mart may end up paying $1.8 million to the Ohio Department of Development as it had given the retailer tax credit on the commitment given by the company that it would create and maintain jobs in Ohio for a certain number of years, when it started the lab in 2002.