An award of tax incentives for General Mills in Cedar Rapids by the state’s economic development board on Aug. 21 didn’t attract much notice, but strikes us as an extremely encouraging sign for that company’s future in the Corridor.
General Mills received the incentives for a project to modernize a production line in Cedar Rapids, where the company makes ready-to-eat cereals, fruit roll-ups and frosting. The company’s request for state assistance is the latest in a long line of expansions at the plant, but this was the first since a January 2019 vote by more than 500 employees to unionize.
We previously expressed our concerns in this space that unionization of the plant, which had long been an open shop, threatened the company’s history of investment in Cedar Rapids going back more than a half century. This was a concern highlighted by the fact that General Mills’ cereal business was hurting at the time, due to changing consumer preferences, and the company was taking steps to cut costs.
The eat-at-home trend fueled by the COVID-19 pandemic has helped revitalize General Mills’ cereal business, and if the plant modernization is completed, the company now expects to create an additional 50 jobs and invest $37 million in Cedar Rapids.
This also seems to be a vote of confidence by General Mills in the labor relations situation at the Cedar Rapids plant, as it seems unlikely that a company with its track record would expand a plant where it’s expecting strikes or work stoppages to become a regular occurrence.
The Retail, Wholesale and Department Store Workers Union, which was voted in to represent General Mills workers, has long represented workers at the Quaker Oats plant in Cedar Rapids. That plant is one of the longest continuously operating plants in the Quaker Foods division of PepsiCo and has mostly enjoyed good labor relations with its unions.
Maintaining good labor relations can be a delicate balance, requiring give and take on both sides. We are glad to see General Mills, a company which has a long history of operating both union and non-union plants, was able to reach its first contact with RWDSU last year and is confident enough to continue making investments here.
Some of the Corridor’s largest employers, including Collins Aerospace, Whirlpool Corp., Quaker and University of Iowa Hospitals & Clinics, have long prospered here with union representation. With good faith on both sides, there’s no reason General Mills can’t join them.
The plant expansion comes at a very good time for Cedar Rapids, which has seen widespread business interruptions due to the Aug. 10 derecho, and both furloughs and layoffs at its largest private employer – Collins Aerospace – due to a steep drop in its sales of OEM and aftermarket parts to the commercial aviation market.
Projects like the General Mills expansion and a proposed $139 million investment by BAE Systems in the same part of Cedar Rapids will help the Corridor economy weather the COVID-19 recession and build a stronger economic foundation for whatever comes next. CBJ