Do Food Industry Mergers and Acquisitions Affect Wages and Employment?
Michael Ollinger Headlines announcing a major merger or acquisition are often followed by an opening paragraph outlining planned job cuts, plant closings, and possible cuts in salaries and wages. The merger or acquisition is often blamed for the cuts and closings, but other structural changes come into play. The late 1970s and 1980s were times of major mergers and acquisitions in the food industry. In beef packing, Conagra acquired Monfort, and Cargill bought the operations of MBPXL and Spencer Beef, renaming them EXCEL. In fluid milk processing, Borden bought Meadowgold in 1987 before Borden itself exited the industry. During this time period, eight food industries—meat packing, meat processing, cheese making, fluid milk processing, flour milling, corn milling, and feed and soybean processing—underwent structural transformation. The number of plants declined by about one-third, the number of employees dropped 20 percent (more than 100,000 workers), and wages stagnated. Poultry slaught
