Nestlé, the global food and beverage conglomerate, has issued a proposal to close down its baby formula manufacturing plant in Co. Limerick, Ireland, which poses a grave threat to over 500 jobs. The move comes as a direct response to China’s rapidly declining birth rate, leading to reduced demand for infant formula products.
In a statement, Nestlé explained, “Today, we are announcing a proposal to cease operations in our Wyeth Nutrition infant formula factory in Askeaton, Co. Limerick, Ireland by Q1 2026. We propose to close the co-located R&D centre by Q1 2025.” The company further stated its intention to engage in consultations with all employees and their representative unions.
Regrettably, Nestlé’s proposal puts approximately 542 colleagues at risk of redundancy, underscoring the magnitude of the decision.
The Askeaton facilities were integrated into Nestlé’s operations as part of its acquisition of Pfizer Nutrition in 2012. Operating under the name Wyeth Nutritionals Ireland Ltd. (WNIL), this factory has been dedicated to producing infant formula products exclusively for export to markets in Greater China and Asia. Presently, the factory employs 491 workers, while the R&D facility provides jobs for 51 individuals.
Nestlé points to the shifting birth trends in China as a critical factor in the decision, stating, “External trends have significantly impacted demand for infant nutrition products in the Greater China region.” The company continued, “The number of new-born babies in China has declined sharply from some 18 million per year in 2016 to fewer than 9 million projected in 2023. The market, which had previously been reliant on imported infant formula products, is also seeing rapid growth in locally-produced products.”
To adapt to these transformative changes, Nestlé is proposing to shift production from Askeaton to two existing factories, one in Suzhou, Mainland China, and the other in Konolfingen, Switzerland.
In its official statement, the company emphasizes that these proposals have been “carefully considered” and are “no reflection on the excellent contribution made by our employees in Askeaton over many years.” Nestlé also noted its ongoing efforts to find a buyer but, to date, has not been successful. The company is committed to initiating a meaningful consultation process with its employees on the proposed closure and remains open to approaches from credible buyers.
Nestlé acknowledges the uncertainty this announcement will bring to its colleagues and their families and assures full support throughout the process.
The backdrop for this decision is China’s evolving population policies. The Chinese Communist Party replaced the long-standing One-Child Policy with the Two-Child Policy in 2016. The shift was intended to address several issues, including an aging population, gender imbalance, and labor shortages while stimulating economic growth through a larger workforce and increased consumer spending.
However, despite the policy change, the Two-Child Policy did not lead to the desired increase in births. Factors such as the cost of raising children, urbanization, and evolving societal attitudes toward family size contributed to lower birth rates.
In 2021, China further relaxed its birth restrictions, implementing a Three-Child Policy. This policy allows families to have up to three children and offers additional incentives, including tax breaks, maternity leave, and childcare support, to encourage larger families. Nonetheless, it remains to be seen whether this latest policy will effectively address China’s demographic challenges.
