Manufacturing Accounts for 42% of Job Losses in 12 Months

by Jamie Walden  on Monday, May. 11, 2009 12:00 am  

(To view the list of the largest manufacturers in the state of Arkansas, click here for a PDF. A spreadsheet version is also available.)

Harsh economic conditions have devastated the manufacturing industry all across the country during the last several months, and Arkansas hasn’t been spared.

According to March data, the manufacturing sector in Arkansas lost 16,800 jobs over the previous 12 months. That accounts for the largest chunk — 42 percent — of total jobs lost in Arkansas since March 2008, according to the Arkansas Department of Workforce Services’ monthly report.The department attributed much of the erosion to a slew of layoffs and plant closures.

Alcoa Inc. of Pittsburgh, No. 24 on this year’s list of Arkansas’ largest manufacturers, blamed “softening demand” when it announced last week that it would indefinitely idle its plant in Texarkana, Texas, by Sept. 30, Director of Corporate Communica-tions Kevin Lowery said. About 250 employees will be out of work.

Lennox Industries, headquartered in Richardson, Texas, and No. 29 on the list, experienced gradual cutbacks due to “market conditions,” a company spokesman said. The air-conditioner manufacturer has shed 515 jobs at its plant in Stuttgart since the list was last published in April 2008.

IC Corp. of Conway, No. 35, has had multiple layoffs since last year’s list was published, losing half its work force. The company’s employment headcount in Arkansas has plunged from 1,000 to 546 during the last 12 months.

O.K. Industries Inc. of Fort Smith, No. 10, experienced its share of job losses during the last 12 months. The company cut nearly 450 jobs, or about 19 percent of its Arkansas work force.

Bright Spots
But not all the news is bleak.

Tyson Foods Inc. of Springdale despite all odds, has hired more employees by adding some de-boning operations, the company said. Tyson remains Arkansas’ largest manufacturer by far.

However, because Tyson brought de-boning operations in house, it didn’t renew its contract with Petit Jean Poultry Inc. of Danville. Petit Jean Poultry, which was knocked off of the list, has since shuttered its de-boning plant in Danville, putting more than 600 people out of work in January.

Simmons Foods Inc. of Siloam Springs also experienced a growth spurt since last year’s list, leaping to the No. 3 spot. The company gobbled up nearly all the assets of Peterson Farms Inc. of Decatur in July. Simmons bought the feed mills, the hatchery operations, the chicken processing plant, transportation vehicles, flocks and a network of growers.

Georgia-Pacific LLC came in at second place.

Pilgrim’s Pride Corp. fell to fourth in the rankings this year of largest manufacturers. Pilgrim’s shut down its chicken processing plant in Clinton in August last year, shedding 600 Arkansas jobs. That move came on the heels of an announcement by Pilgrim’s that it planned to shut down the “tray-pack chicken business” at its plant in El Dorado, which also cut 600 jobs.

New developments in the Pilgrim’s Pride chicken saga reveal that the state of Arkansas and the Arkansas Economic Development Commission are working with an unnamed group of investors to keep the El Dorado plant open.

If all goes well, it won’t be the first turnaround engineered by state officials and local chambers of commerce.

When news broke that Cooper Tire & Rubber planned to close one of four plants, state officials and the Texarkana Chamber of Commerce leapt into action. Long story short: The Arkansas plant is still open.

Randy Zook, president and CEO of the Arkansas State Chamber of Commerce, said such legwork was the best strategy to fend off more job losses.

Zook said the state chamber was urging local chambers to nurture relationships with the owners of local plants. Zook said this pre-emptive tactic could pay off if some of those businesses later decide to make cuts.

“We’re working with other chambers across the state to make sure that community leadership in every part of the state realizes that decisions to keep open or to close plants are decisions made by people,” Zook said. “And it’s very productive right now to have a personal relationship with corporate leadership of any business that owns or operates a plant in a given area.”

 

 

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