End near for Simplot
Published 12:14 am Sunday, November 14, 2004
HERMISTON – In the wee hours next Saturday morning the last shift of workers at the J.R. Simplot potato processing plant here will punch their time cards for the last time and file out of the building forever.
The plant will close and hundreds of local workers will be without the job and paycheck many have leaned on for a generation. Some have found new jobs, officials say, many have not.
The silver lining of the dark cloud hanging over the Simplot plant is that economists, and officials from local government and the business community say that in the long run Umatilla and Morrow Counties will rebound, thanks to their burgeoning populations and easy access to transportation. Hermiston has been growing and is expected to keep growing.
But in the short run, there will be losers.
There are state and federal programs for laid-off workers, dollars for re-training, and unemployment checks for at least six months. Anticipating the Nov. 18 shuttering, the Hermiston Chamber of Commerce and Simplot sponsored a series of job fairs for workers with the condition that employers participating in the fair not take away any workers before the Simplot plant officially goes off-line. Additionally, a day was set aside for plant employees to meet with credit advisors to help keep their finances afloat during the transition.
But despite those safety nets, Simplot workers are viewing next week, and the weeks after that, with anxiety and sometimes dread because of the instability that comes with losing a job.
Simplot officials said they are closing the plant it built and has operated since 1977 because of disappointing overseas and domestic demand for its product, frozen french fries.
“We had about one more plant than we needed,” said Fred Zerza, spokesman for the Boise-based food processing giant.
At full operating capacity, the Simplot plant employed about 600. Going into the last week the plant still had about 475 workers, said Dan Akey, unit director of the plant.
Those who already left have likely found jobs, Akey said, but the company has not tracked those workers.
Those who remain have either lined up a new job, are planning on taking advantage of the chance to return to school for job training, or, like a number of employees passing through the lunch room after their shift ended last Thursday, are unsure what will happen.
With three kids at home and a wife who also works at the soon-to-be-shuttered plant, Manuel Velasco of Hermiston freely admits he is worried. He has applied at other food processors and plans to apply at the Wall-Mart Distribution Center. But he may have to take a job that pays less for harder work.
“If they don’t need me I’ll go looking in the fields,” said Velasco, 46, who has punched his card at the plant for 17 years and doubts if he can afford re-training, even if somebody else pays his tuition. “What am I going to do with the bills if I go to school? This is good, to go to school, but I can’t.”
He doesn’t see himself as an exception but the rule, and doesn’t reckon he will land a job right away paying him the $12 an hour he makes at Simplot.
He can rattle off a list of the worries keeping workers awake at night.
“Everybody has bills, car, house, electricity, insurance, kids in school, shoes, clothes, laundry, oh man!”
“It’s a really tough decision,” said Bonnie Berry, 45, of Echo. After working at Simplot for 26 years, almost as long as the plant has been producing. She’s considering a return to college to study accounting. “I know in the long run I would benefit from going back to college, but do I want to take two years and not build up my retirement, not put anything into savings?”
On an average week, without overtime, Berry brings home about $480 before taxes. If she decides to re-enter the workforce she will be eligible to receive unemployment checks totaling $348 a week for six months, granted that she can prove she is actively looking for work.
Berry might be due for a change of careers. She attended the plant’s job fair but noticed that many of the companies in attendance were food processing outfits, like ConAgra and Watts Brothers.
“I personally don’t want to go into that again, I’m a little gun shy,” Berry said.
Two Rivers Correctional Institute also had a table at the job fair, she said.
“I can’t see myself doing that,” Berry said.
For Velda Dunham of Stanfield, 51, the loss of a job she’s held for 23 years hits hard, but it’s almost the least of her worries. Dunham’s husband died earlier this year and her son is headed to Iraq. She isn’t sure what her next move will be.
“If I had to worry about everything in my life I’d have an ulcer, I’m not going to worry about the plant,” Dunham said. “I don’t know what I’m going to do. I will survive.”
For those who are looking, there are jobs available in the area, said Rod Davis, executive director of the Hermiston Chamber of Commerce. And with a flux of new construction to help off-set the tax dollars lost from Simplot’s departure, the tremors shouldn’t be too noticeable, he contends.
Davis believes the job losses will be absorbed almost immediately.
The Union Pacific’s Hinkle Yard has hired 104 new employees since the beginning of the year, and plans to hire more in 2005, said Spokesman John Bromley.
Although workers are the most visible group to bear the brunt of the closure, the ripple effects are bound to be felt across the community in the short term.
For the fiscal year ending in the summer of 2004, Simplot’s plant and property on the outskirts of Hermiston were valued at $63.1 million, according the Umatilla County assessor’s office.
Once the equipment is removed from the building and Simplot mothballs the plant in anticipation of a new buyer, that value will drop considerably, resulting in less money for tax districts, ranging from schools to fire protection to cemetery upkeep.
In the 2003-2004 fiscal year about $176,000 of the $884,000 Simplot paid in property taxes went to Hermiston schools. Simplot also contributed hundreds of thousands of dollars to pay back bonds. When the facility is removed from its prominent status on the tax rolls the rates for other business and home owners may increase, resulting in what is essentially a tax hike.
Jerry Wilson, superintendent for Hermiston schools, is also waiting to see if the closure will result in an exodus of worker’s families and a drop in enrollment. “As of now we are in a wait and see attitude,” Wilson said.
If the future sounds like so much gloom and doom, take heart, economists say, predicting that Umatilla County can absorb the laid-off employees back into the workforce and that a growing tax base will offset the loss of Simplot’s departure.
“As far as the community is concerned I don’t think there will be a huge, noticeable impact,” said Dallas Fridley, a regional economist for the state Employment Department. “I don’t think you’ll have 600 people on the street looking for work.”
But on an individual level, many of Simplot’s wage earners are immigrants who are not native English speakers and single mothers, people who don’t have a lot of options when it comes to relocating or landing another job right away, Fridley said.
Unless a worker can jump back into the same kind of work “Your prospects are for a lower paying job with fewer benefits and not the same kind of hours,” he said.
And with the slow season for food processing on the horizon, “You face a much more difficult situation.”