Pepsi says slumping sales due to Philadelphia's new sweetened beverage tax is prompting layoffs of 80 to 100 workers at three distribution plants that serve the city.
Pepsi announced the job cuts Wednesday saying they will occur over the next few months at the plants in north and south Philadelphia and in Wilmington, Delaware.
"Pepsi has called Philadelphia home for nearly 100 years," Pepsi said in a statement. "We are proud of our investments in the city and the good-paying jobs we've been able to provide to many residents for generations. Unfortunately, after careful consideration of the economic realities created by the recently enacted beverage tax, we have been forced to give notice that we intend to eliminate 80-100 positions, including frontline and supervisory roles, in Philadelphia over the next few months, beginning (Wednesday). This isn't something we take lightly or want to do, and we are committed to working with our managers and the union to treat impacted employees with the care and dignity they deserve."
The company employs 423 people in the city. Pepsi spokesman Dave DeCececco said the tax enacted at the start of 2017 has cut sales by 40 percent in the city.
The 1.5-cent-per-ounce tax on sweetened and diet beverages is imposed at the distributor level. If fully passed on to the consumer, it amounts to $1.44 on a six-pack of 16-ounce bottles.
Protest efforts against the tax haven't fizzled out since it went into effect, despite the city's hefty report of figures for January collections. The city took in $5.7 million in January – more than double the city manager's projection of $2.3 million for the first month the tax was collected, the city’s Revenue Department said.
"The sad reality is that the job losses the city is witnessing -- including at Canada Dry and the cuts in hours at local supermarkets -- was an avoidable outcome," Anthony Campisi, spokesman for the local coalition opposing the beverage tax, said. "Government policies should promote, rather than stifle, economic growth, and it is unfortunate that the mayor and City Council chose to ignore serious concerns raised by our coalition and others about the tax prior to implementation. While we appreciate the government's need to raise revenue, we oppose doing so on the backs of hardworking Philadelphia families and local businesses. Our hope is that the mayor and City Council rethink their approach, this time listening to input from industry and local business owners."
Some Philadelphia supermarkets and beverage distributors have also said they're gearing up for layoffs. [[238427591, C]]