Steel firm to shutter PB plant, lay off all
Posted on Saturday, July 12, 2008
Allied Tube & Conduit will close its Pine Bluff manufacturing facility by the end of the year, putting 226 employees out of work.
The plant, which makes steel pipe, tubes and other roll-formed steel products for commercial construction, will shift most of the production to Harvey, Ill., and some to Philadelphia and Phoenix. No jobs will be relocated.
Rising overhead costs, including energy and transportation, is forcing the company to consolidate its operations at fewer locations, said Ira Gottlieb, spokesman for Electrical & Metal Products, a business segment of Allied’s parent company, Tyco International.
A 28-year employee at the company, Debbie Krack, said she’s happy she will receive 50 weeks’ severance compensation, but she’s troubled by the closure and its impact on a city struggling with population decline and loss of industry.
Pine Bluff has lost at least 15 industries in the past decade, including Allied, and seen its population decline to 51, 758 in 2006 from 57, 140 in 1990.
“It’s really sad,” said Krack, a Pine Bluff native who worked in accounts payable at Allied. “The restaurants in Pine Bluff are closing, and all the businesses are going away. I wish it wasn’t. I wish I could stay here and retire from here.”
Krack said she plans to move to Northwest Arkansas after Allied closes in September.
The closing will be conducted in phases, Gottlieb said, to be completed no later than Dec. 31. Most of the work force will be laid off between Sept. 8 and 19, with a handful kept on through December to help with cleanup and shutdown. Employees who stay through their company release date will be eligible for a severance package, Gottlieb added.
Gary Reynolds, Allied’s general manager in Pine Bluff, said the employees will receive a severance package ranging from four weeks’ to 52 weeks’ pay, depending on seniority.
It was a difficult decision to shut down the plant, Gottlieb said, but was based on a companywide analysis of costs and production.
“After looking at all that, we decided that many of the costs of the Pine Bluff facility can be eliminated or significantly reduced by consolidating the production in existing locations in the United States without affecting our production output or service,” Gottlieb said.
Reynolds said rising steel and fuel costs were a factor in the closing of the Pine Bluff plant, which is located in the Harbor Industrial District and just down the road from the Pine Bluff port.
“We have done a great job here, improved our operations steadily and improved our reputation, quality and customer service,” Reynolds said. “This is strictly a matter of the economy and a numbers game.”
Allied announced the decision to employees Thursday in a meeting.
Officials were informed a little earlier and started making preparations accordingly, said Lou Ann Nisbett, president and chief executive officer of The Economic Development Alliance of Jefferson County. There will be a career fair and seminars for employees most likely within the next couple of weeks, she said. Some Pine Bluff industries are looking at expanding, and there will be other opportunities for displaced workers, she said.
The Arkansas Economic Development Commission also will be assisting, said spokesman Joe Holmes. “We have met with [Nisbett ] and the community, and we’re assisting on coming up with a strategy,” he said.
In a news release Friday, Pine Bluff Mayor Carl Redus said he found the news “especially painful coming during the challenging economic times in our country.”
“Pine Bluff is always looking to support and retain our existing businesses, as well as attract new ones, therefore I was deeply disappointed to learn of the impending closure of Allied Tube & Conduit Corp.,” Redus said.
The decision comes weeks after the Jefferson County Quorum Court did not pass a measure that would have placed a half-cent economic development sales tax on the ballot.
Nisbett has said she is considering an option of getting 3, 000 signatures to place the proposal on the November ballot.
Jeff Collins, an economist with Streetsmart Data Services in Johnson, which is between Fayetteville and Springdale, said that this plant closure underscores a real struggle for manufacturing in a weakening economy.
“The Pine Bluff area as [a metropolitan statistical area ] has struggled for a while, and there’s certainly been struggle in terms of employment,” he said.
Steel is no longer in as much demand because of less construction, part of a multiplier effect for job loss. “Obviously the loss of one manufacturing job implies loss in other sectors,” he said.
FEEDBACK:
Something to say about this topic? Submit a Letter to the Editor online
