Thread: Electrolux to eliminate 850 jobs in Iowa. To Juarez

Electrolux to eliminate 850 jobs in Iowa

By JEFF ECKHOFF and DONNELLE ELLER
• October 24, 2009

Webster City, Ia. — Declining demand for washers and dryers will cost Iowa roughly 850 jobs over the next year as Electrolux shifts all its North American manufacturing to Mexico, the company announced Friday.

Production of Frigidaire washers and dryers in Webster City and Jefferson is scheduled to end sometime in the first quarter of 2011.

Electrolux said it now employs roughly 925 people in those communities. The Swedish company has already eliminated more than 1,000 Iowa jobs since 2006.

The announcement surprised no one at the Webster City plant, said longtime employees Dick Golberg and Don "Butch" Burton.

"We knew it was coming," Golberg said. "When they built the plant in Juarez, we knew it was going to happen sooner or later. We were just waiting for the date."

Electrolux built a $100 million factory in Juarez, Mexico, just across the border from El Paso, Texas, for laundry products in 2007. That came after the company said it was eliminating 700 jobs in Webster City.

Burton said there was little reaction from workers who gathered in the warehouse area for the announcement Friday.

"There was no crying, no yelling or hooting and hollering," said Burton, who has worked at the plant for more than 26 years. "It took five minutes."

Iowa State University economist David Swenson said Electrolux, like many of its competitors, has been rumored to be on the verge of moving appliance production out of the United States.

"This is one of those closings that's been a long time coming," Swenson said. "It's not a surprise.

"That's going to have one heck of a multiplied-through economic impact," he said. "They were really good jobs for that area. ... Everything in that entire Webster City area is going to realize a hit from that."

Growing manufacturing losses like those at Electrolux have hammered Hamilton County. The unemployment rate was 8.1 percent in September, spiking from 3.6 percent a year earlier.

It's not just the Electrolux production jobs that will be lost. A sister warehouse across the street will likely close, and suppliers of pallets, plastic parts and other products will likely have to cut jobs.

"It's a lot of smaller businesses that will be hurt, too," said Golberg, who has worked at the plant for 24 years.

The plant closing will hit more than Webster City. Its workers come from places like Stanhope, Eagle Grove and Fort Dodge.

"It's going to hurt Main Street USA," Burton said.

According to data from Iowa Workforce Development, roughly 35 percent of Hamilton County residents made their living from work in factories this year. In 2007, the most recent information available, the average Hamilton County worker was paid $30,871; median household income was $47,603.

Burton and Golberg said workers cannot compete with wages paid in Mexico. The men say workers at the Mexico Electrolux plant are paid about $2.50 an hour. The average union wage here is about $16.50.

Workers at the plant have already struggled with reduced hours as the recession has cut demand for products. Burton will work one day next week, Golberg four. It was a different story five years ago. The men worked six, seven days a week. "We got tired of the overtime," Golberg said.

Electrolux spokesman Tony Evans blamed the Iowa closures on the fact that "industry sales of laundry products have been impacted by the global economic crisis, and that's caused a substantial decrease in demand."

Evans said company officials "expect production and employment levels to continue normally based on market demand" right up until the shutdowns.

About 45 manufacturing jobs at a satellite plant in Jefferson are scheduled to be gone by the fourth quarter of 2010, Electrolux said. The Webster City factory is marked for closure in the first quarter of 2011.

Evans said Electrolux's technology center, a sort of research and development operation for laundry products that now employs 75 people, will remain in Iowa even after the other jobs move to Juarez.

Juarez is also home to an Electrolux refrigerator factory, which replaced about 2,700 jobs at a Greenville, Mich., plant in 2005.

"This was a difficult but necessary decision," said Frank Wagner, vice president of operations for Electrolux Major Appliances North America.

"Electrolux is aware of the impact this decision will have on our employees and their communities. The company will be taking steps to assist employees with this difficult transition and will work with local and state officials to ensure that all training resources are made available to our employees."

With a year or more before the plant closes, Golberg and Burton hope another company will locate in the area. "That's what everyone hopes, but what are the chances?" said Burton, who added that he hoped state leaders would pay attention to their losses.

When Maytag Corp. closed, Burton said former Gov. Tom Vilsack met with employees. "Where's Culver? I even voted for him," Burton said.

Gov. Chet Culver called the decision "difficult to understand" in a statement Friday, and said he had asked the Iowa Department of Economic Development to meet with Electrolux officials "to find all possible means to reverse this decision."

Options for new employment — and retraining — are limited, the men said. "How many nurses do we need?" asked Burton, 51.

"I've talked with people who were laid off six months ago, and they still can't find a job," said Golberg, 56. "And if you do find a job, it pays $10 an hour, if you're lucky. It's no good for anybody."



http://www.desmoinesregister.com/articl ... /1001/NEWS

Big business just keeps screwing the American worker!! Maybe Americans should stop buying their products! You can not tell me people getting paid $2.50 an hour are buying them!

Originally Posted by SOSADFORUS

Big business just keeps screwing the American worker!! Maybe Americans should stop buying their products! You can not tell me people getting paid $2.50 an hour are buying them!

ABSOLUTELY TIME TO STOP BUYING THEIR PRODUCTS!!!!!

We have moved so many of our best jobs to Mexico, yet we still subsidize countless Mexican families by illegals working here.

How cheap are the labor forces in Mexico that the taxpayers suffer on both ends of this spectrum?

Soon, no one will be afble to afford to buy their products, all the jobs will be gone.

Originally Posted by Newmexican

Soon, no one will be afble to afford to buy their products, all the jobs will be gone.

No soon to it just look around its allready happened.

We just lost a manufacturing plant, Monroes, in Cozad Ne. Monroes also has a plant in mexico that wasn't closed.