Blaming increased competition and a falling youth population, the San-Francisco-based company said it was forced to ask 4,000 workers to stay at home.

"We're adjusting our production to market demand," said spokeswoman Tamara Churchman.

The world's oldest denim-maker - which celebrated its 145th anniversary this year - is facing stiff competition from new brands such as The Gap and Tommy Hilfiger with their non-denim products.

Levi's now holds just 17% of the jeans market

Falling sales have left the company claiming a meagre 17% of the global jeans market. Until recent years, Levi's 501's and docker jeans were the dominant global brand.

Europe closures

Last month, it announced the closure of four plants in Europe, with the loss of 1,560 jobs.

The US plants, based in Georgia, Texas, Tennessee and North Carolina are scheduled to reopen in February.

Until then, workers will receive 90% of their pay through dole and holiday pay.

Last year, the company's global revenue fell to $6.9bn after peaking at $7.1bn in 1996.

The company has been contracting for the past two years.

Last November, Levi's laid off 7,400 workers, about 34% of its North American workforce, and closed 11 of its 27 plants.