Citing a major downturn in the electronics industry, Isola Laminate Systems announced Monday that it will close its La Crosse manufacturing plant at 1300 Norplex Drive by March 31, 2002. But it said its headquarters will remain at 230 N. Front St. in downtown La Crosse.
About 190 people, including 66 currently on layoff, will lose their jobs in La Crosse, the company said. About 95 employees will remain in La Crosse - including about 75 at the company's headquarters and about 20 at its analytical and research laboratories, which are at the Norplex Drive location.
The plant is closing because of a major downturn in the electronics market, President Denny Ford said at a press conference Monday afternoon. It makes copper-clad laminates that its customers use to produce printed circuit boards. The circuit boards are used in such electronic equipment as computers, telecommunications devices and industrial controls.
Ford also said his company is closing its Hoosick Falls, N.Y., plant for an indefinite period, but expects to eventually reopen it. With that facility temporarily closed, and the La Crosse plant permanently closed, Isola Laminate Systems will continue to operate four plants - in Chandler, Ariz.; Fremont, Calif.; and Pendleton and Ridgeway, S.C.
"The La Crosse facility was one of our older facilities," Ford said, when asked why it was chosen for closing. "The equipment set was more geared toward smaller-run, low-volume production lines."
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He said the headquarters will remain in La Crosse because it has been here for years, the company has plants on both coasts and serves customers throughout the nation, it has a well-established and very capable work force "and we have found it a very good place to do business."
At the La Crosse plant, Ford said, "We will be going through downsizing beginning around the end of the year. And we expect to be pretty well out of the manufacturing by the end of quarter one in 2002."
He said Isola Laminate Systems also is eliminating about 20 salaried positions from its U.S. work force. Its parent company, Isola AG, is based in Duren, Germany.
Ford said wages for hourly employees at the La Crosse plant vary, but average $12 to $15 an hour.
"The business environment for us has been deteriorating since early this year," Ford said. "We had a significant and unprecedented downturn in the electronics marketplace."
Ford said the Sept. 11 terrorist attacks also had an impact. "Some of our customers had begun to show some signs of optimism" before the attacks, he said. "And it seemed that after the Sept. 11 incidents, many of them became much more pessimistic and revised their longer-term forecasts."
Ford had no prediction whether Isola will put the La Crosse plant up for sale. It owns that building and has a "longer-term" lease on the headquarters building, he said.
Hourly production workers at the La Crosse plant are represented by United Auto Workers Local 1263. The union local has about 158 members, including the 66 laid-off employees, said its president, Steve Jorgenson.
"It was pretty quiet," Jorgenson said of the reaction of first-shift employees, when company officials informed them of Isola's plans at a meeting Monday morning. "I don't think it had settled in yet.
"The rumor's (that the plant might close) kind of been out there, but we've tried to be optimistic," Jorgenson said. Employees have been aware of the slowdown in the electronics industry, he said.
Jorgenson said he will talk to U.S. Rep. Ron Kind, D-La Crosse, about ways to assist Isola employees who will lose their jobs. "We're going to see if we can come up with something to help the workers," he said.
Isola workers who are losing their jobs probably will have difficulty finding comparable jobs in the La Crosse area "with the economy the way it is now," Jorgenson said. "Quite a few are nearing retirement age but aren't quite there yet."
Jorgenson, who is a maintenance employee, has worked at the plant since 1980 and has been union president for 12 years. "My dad worked there 40 years," he said. "That was probably the hardest call I made, to call my parents and tell them the doors were going to close."
Isola Laminate Systems traces its history to 1945, when it was founded in La Crosse as Northern Plastics.
As ownership changed over the years, it later went by the names Norplex, Norplex/Oak and AlliedSignal Laminate Systems. In 1999, Ruetgers AG based in Essen, Germany, bought AlliedSignal Laminate Systems and merged the business with Isola AG.
Mayor John Medinger said he was disappointed but not surprised that the La Crosse plant will close. "We really have had a tough stretch lately," he said, referring to this year's closing of the LaCrosse Footwear Inc. plant, recent layoffs at The Trane Co. and the 1999 closing of the G. Heileman Brewery, which now operates with a smaller work force as the City Brewery.
"I feel very badly for these folks," Medinger said of Isola employees who will lose their jobs. "Hopefully, they will be entitled to the benefits that will allow them to get extended unemployment and training programs."
"In as much as manufacturing has been in a recession, in that regard (the Isola plant closing) is not a surprise," said James Hill, executive director of the La Crosse Area Development Corp. "We've had concerns for a good long while," he said, and LADCO and others have worked to keep the company in La Crosse. For example, a few years ago LADCO helped Kind when he convinced the federal government to reclassify and thereby lower duties on a raw material that Isola imports, he said.
Many electronics-type companies are restructuring in the face of foreign competition and a downturn in the national economy, said Dick Granchalek, president of the Greater La Crosse Area Chamber of Commerce. Still, he said, "It's always a surprise when announcements of this nature are made. You need to have compassion for the employees that are affected."
Workforce Connections Inc. will seek additional federal funds from a state agency to serve Isola employees who are about to lose their jobs, Executive Director Jerry Hanoski said. It appears that money will be available as a result of President Bush's economic stimulus package, he said.
"In terms of our regular dislocated worker assistance, in the past year we've had just an unprecedented demand for those services, given Stroh, LaCrosse Footwear and Trane Co.," Hanoski said. "And we are just about tapped out of our local resources."
Workforce Connections provides dislocated workers with such services as relocation assistance, education, job search assistance and assessment, and counseling.
"The type of jobs being lost (at Isola) is kind of disappointing," said Bill Brockmiller, state labor market analyst in La Crosse. "It's value-added manufacturing, the kind one particularly likes to see in an area." Such jobs tend to be more stable and to pay more than other manufacturing jobs, he said.
"In the short term, they may encounter some difficulty staying in the same line of work and in the same set of skills," Brockmiller said of Isola employees who lose their jobs. Manufacturing has slowed nationwide in the past year, he said.
The Isola job losses could raise the La Crosse metropolitan area's unemployment rate by one-tenth to two-tenths of a percentage point, Brockmiller estimated. The area's September unemployment rate was 3.5 percent.
WHAT: Isola Laminate Systems announced Monday it will close its La Crosse manufacturing plant at 1300 Norplex Drive by March 31, 2002. But it said its headquarters will remain at 230 N. Front St. in downtown La Crosse.
WHY: The company cited a major downturn in the electronics industry, which has resulted in lower sales of the copper-clad laminates that its customers use to produce printed circuit boards.
EMPLOYEES: About 190 people, including 66 currently on layoff, will lose their jobs in La Crosse. About 95 employees will remain in La Crosse.
ISOLA LAMINATE SYSTEMS HISTORY
1945 - Founded in La Crosse as Northern Plastics, it originally manufactured plastic rowboats, bread trays and toilet seats.
1949 - Product line changes to industrial laminated plastic sheets.
1957 - Copper-clad laminates for printed circuit boards are added to its product line.
1961 - Company becomes known as Norplex.
1965 - Norplex is acquired by Universal Oil Products Co.
1978 - Signal Cos. buys Universal Oil Products Co.
1985 - Signal Cos. merges with Allied Corp. to form AlliedSignal Inc.
1989 - AlliedSignal Laminates moves into its new world headquarters in the remodeled W.A. Roosevelt building at 230 N. Front St.
1999 - The German company Ruetgers AG buys AlliedSignal Laminate Systems and merges it with Isola AG to form Isola Laminate Systems, the U.S. business unit of Isola AG.