Caterpillar Inc. (CAT) said Tuesday it will lay off nearly 2,500 U.S. employees and close a plant in Georgia in response to the ongoing declines in demand for its construction equipment.

The Peoria, Ill.-based company plans to close its Jefferson, Ga., plant that produces fuel systems. The company said 89 workers at the plant will lose their jobs.

The work done at Jefferson will be moved to other Caterpillar plants in Thomsonville, Ga., and Pontiac, Ill.

Caterpillar said an additional 2,365 employees in three states will be laid off.

In Griffin, Ga., 200 employees will be idled at an engine plant. In addition, the company plans to lay off 911 workers at its East Peoria, Ill., plant where bulldozers are built and 815 employees at its Aurora, Ill., plant where wheel loaders and excavators are assembled.

In Layfette, Ind., where Caterpillar manufactures large engines, 439 employees received layoff notices.

Caterpillar in January said it will eliminate 20,000 positions and offer buyouts to about 25,000 U.S.-based employees.

Caterpillar's stock recently fell 12 cents, or 0.5%, at $26.30.

-By Bob Tita, Dow Jones Newswires; 312-750-4129; robert.tita@dowjones.com