What’s next for victims of Hutchinson layoffs?

The news came to Hutchinson Mayor Steve Cook by telephone early in the morning. Hutchinson Technology, Inc. would be laying off somewhere in the neighborhood of 600 jobs over the next year. Cook wouldn’t name the messenger. “Let’s call it ‘management’ and leave it at that,” was all he would say.

When I reached him on the phone around lunchtime Tuesday he sounded beat down, even as he spoke optimistically about Hutchinson’s future. There is the new industrial park and the city’s trusty 3M plant. As for Hutchinson Tech, he said, “We’ve had a very good relationship over the years and I see that continuing. This is just something they felt they needed to do.”

As the story unfolds, questions inevitably arise. Here are a few answers:

Didn’t this already happen?
That was 2009, when Hutchinson Tech laid off 969 workers. It was the largest mass layoff that year (the next biggest layoff was electronics manufacturer Celestica with 559 displaced workers). The 2009 Hutchinson Tech purge was also bigger than any mass layoff in 2008.

According to Tony Thomann, regional manager at the nonprofit Central Minnesota Jobs and Training Services, of the 700 laid off Hutchinson Tech workers who registered for the organization’s services after the 2009 layoffs, 230 are still in a transition phase — many of them in training to “skill up.” Many of these people live inside Hutchinson city limits, but Hutchinson Tech has traditionally been an important employer with significant drawing power. Thomann and his organization have served workers who commuted from cities like Willmar, Monticello and Olivia.

The next wave of layoff notices will begin circulating March 21.

Who are these workers?

Mostly they work in manufacturing, which is a much broader skillset than might be assumed. “We have to be careful not to over-generalize,” says Thomann. “Some of these workers are people are highly skilled engineers and managers.”

Once a worker receives a layoff notice, what comes next?

The Minnesota Department of Employment and Economic Development will get a list of names from the company and pass that information to Central Minnesota Jobs and Training Services, who will begin contacting workers and offering their services.

In a case like this, Thomann explains, the organization might place an ad in the local paper and hope to attract people to a meeting to discuss next steps.

Laid off workers who qualify for unemployment insurance might also qualify for the state’s Dislocated Worker program, which exists to help workers who are forced to change occupations or industries because of skill limitations or quirks of the job market.

Are there any special benefits when your company sends your job overseas?

Some of the jobs cut in Hutchinson will move to Thailand (others will move across the Wisconsin border to Eau Claire). Because Hutchinson Tech is sending some of the jobs overseas, laid off workers can expect a package of information from the Trade Adjustment Assistance Program. An outgrowth of the federal government’s Trade Adjustment Act, the program exists to provide extra financial and other assistance to American workers who lose their jobs to, say, Thailand.

Anthony Alongi is director of Minnesota’s Trade Adjustment Assistance program. He says Hutchinson Tech has been cooperative with the program — something not to be taken for granted. Alongi says about one-third of the employers the program deals with are less-than cooperative. Sometimes it’s locked doors or phone calls ignored. Other times it’s lawyers. In a perfect world, Alongi explains, an employer gives the program a month’s notice or more.

Already-laid off Hutchinson Tech workers are still benefitting from Trade Adjustment Assistance, even as the program prepares for the next wave.

What about the city of Hutchinson? How does this ripple out?

All the ways you might expect, says Mayor Cook, and a few you may not. There will be a hit to small businesses and local health-care providers and laid off workers curtail spending or move away for other work. But there will also be a hit to public utilities. A manufacturer like Hutchinson Tech uses lots of water, sewage and electricity — revenue for all of these services will go down. It’s a small city; it’s vulnerabilities are as varied as its dependencies.

Comments (4)

  1. Submitted by Howard Salute on 03/09/2011 - 12:25 pm.

    Can this be a learning experience? Is there anything the State of MN could have done to prevent this disastor? We all hear the complaints of “charity to billionares” when the state tries to give incentives for business investment. And now we see the other side; 600 MN families will be hurting for a long time and a small town will be forever changed. What can we learn?

  2. Submitted by Patrick Tice on 03/09/2011 - 08:16 pm.

    Although State and local governments can offer incentives and tax breaks, in the end it boils down to a business shaving costs and maximizing profits. Incentives are not “forever” and may leave states competing for businesses like cell phone carriers, always trying to lure customers to their plan with temporary discounts. None of this is to the greater good. There has to be a balance where everyone benefits and no one entity does all the heavy lifting. If somewhat higher taxes are balanced by excellent services as a result, a business may elect to stay put. Other businesses are driven by short-term gain and will follow the savings right down to the bottom no matter how much value their taxes might buy in a nice place like Hutch. Sometimes business conditions simply dictate a move in spite of a serious commitment to the community.

  3. Submitted by Don Frey on 03/09/2011 - 08:41 pm.

    Mr. Salute is correct. We need to be trying to figure out what caused the layoffs in Hutchinson. The jobs moving to Thailand should be fairly easy to understand – much lower wages. But what about the jobs moving to Cheeseland? Is it lower wages there, too, which doesn’t seem likely? Or, is it lower taxes and other costs to the business? There have been many Twin Cites companies that have moved elsewhere, some right across the state line in both directions, for lower Workers Compensation costs (with lower protection for the workers, too) and lower or no corporate taxes. Can you say Marigold Foods and Twin City Federal? Our state needs to find ways to be competitive on these issues or we will continue to lose good-paying jobs. Nobody can afford new homes, new cars, or new appliances on the money they make at Wally World. We need to find creative ways to reinvigorate manufacturing in Minnesota. And, to the “no new taxes” crowd, please spare us the tired rhetoric. After 8 years of that, we continue to lose manufacturing jobs in Minnesota. So, can that drivel and let’s find ways to work together to revive our state’s economy. If we don’t restore the middle class, we’re as doomed as the dinosaurs!

  4. Submitted by donald maxwell on 03/10/2011 - 05:59 am.

    Remember, all this job loss to Asia is in the name of “free trade” – which is not really free. We gave away our ability to tariff goods made with labor costs we can’t possibly match, with the WTO and related moves helped along by Clinton and his successors.

    Not only do we lose manufacturing to essentially zero wage competition, the state’s costs in aid of displaced workers can’t even be recovered by tariffs, making our labor costs even a little higher.

    We are losing this game.

Leave a Reply