AOMORI - A major stockings manufacturer in Japan announced on Jan. 20 that operations at its domestic production subsidiary in northeast Japan will cease at the end of May, meaning over 500 employees at a factory in Aomori Prefecture will be fired.
Atsugi Tohoku Co. Ltd. is a subsidiary of Kanagawa Prefecture-based Atsugi Co. Ltd., which is responsible for deteriorating business performance due to the coronaviruses. Atsugi Tohoku has factories in the cities of Mutsu in Aomori Prefecture and Morioka in Iwate Prefecture. The news has caused tensions locally, as the Mutsu office, a driver of local employment, has over 500 workers who will be effectively dismissed.
Atsugi said that the production environment has become challenging with demand from foreigners dwindling due to the Pandemic, and demand for stockings is declining as new lifestyles, such as working from home and refraining from going out, have taken hold.
The company plans to move its production bases to two plants in China in order to reduce costs and turn a profit.
Atsugi Tohoku is a wholly owned subsidiary of Atsugi and employs about 610 people in its two factories. The plant of Mutsu was established in 1966 and operated as the main factory of the company. The coronaviruses caused a reduction in fixed costs in July 2020, which was initially intended for around 330 people to take voluntary retirement.
Masahiro Furukawa, Atsugi's executive officer, said that the company will consider it after consultation with the labor union about the employment of factory workers. The industrial employment policy division chief Mutsuko Kobayashi said, I can't deny my surprise that over 500 people are unemployed. We haven't been able to sort out anything as of now.