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Layoffs At Levi Strauss

Levi Strauss & Co., struggling to compete in an expanded jeans market, will temporarily close seven factories over the holiday season.

More than 4,000 workers will be asked to stay home in December and January in Texas, Georgia, Tennessee and North Carolina, the San Francisco-based company said Thursday.

"We're adjusting our production to market demand," said spokeswoman Tamara Churchman. "Rather than build our inventory up, we elected to cut back on production."

The factories, in McAllen, San Benito, Brownsville and Wichita Falls, Texas; Valdosta, Ga.; Mountain City, Tenn.; and Murphy, N.C., make the basic Levi's five-pocket jeans.

Demand for Levi's trademark jeans has dropped in recent years. Competition from newer fashion brands, such as The Gap and Tommy Hilfiger, has cut the world's oldest denim maker's hold on the jeans market to less than 17 percent.

The plants are scheduled to reopen in February. Until then, workers will receive 90 percent of their pay through unemployment, supplementary compensation, vacation and holiday pay, she said.

Levi Strauss, the world's largest brand-name clothing maker, celebrated its 125th anniversary this year. Until recent years, Levi's dominated the jeans market with its famous 501 jeans and its Dockers and Slates brands.

But last year, worldwide revenue fell to $6.9 billion after peaking in 1996 at $7.1 billion. Last November the company said it would lay off 7,400 workers, about 34 percent of its North American work force, and close 11 of its 27 U.S. plants, to compensate for lower demand.

In July, Levi Strauss said it would likely will cut more jobs during the next two years in an effort to trim $200 million in costs, but did not provide any specifics.

Since then, the company has said two finishing centers where workers wash, rinse, dye and press garments in El Paso and Amarillo, Texas, would close by year's end.

Levi Strauss also said it would close four European factories three in Belgium and one in France, citing a drop in the size of Europe's youth population and a shift in consumer taste from denim to non-denim clothing.

By Jean H. Lee

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