Herald Journal - Enterprise Dispatch - Delano Herald Journal
Hutchinson Technology layoff impacts local communities

January 19, 2009

By Starrla Cray
Staff Writer

HUTCHINSON, MN – Of the 2,300 people who were employed at Hutchinson Technology Inc. (HTI) in Hutchinson, 950 no longer have a job.

“We’re saying goodbye to many good people, which is very hard to do,” HTI Director of Corporate Communications Connie Pautz said. “These are very difficult times for everyone.”

The full impact of Hutchinson Technology’s recent massive layoff remains to be seen, but for former employees, as well as their communities, the layoff is cause for concern.

“How do you replace something that big?” Silver Lake City Clerk Kerry Venier, said. “From the city side, it makes us a little nervous. It’s jobs leaving the county.”

“It’s really disturbing and very troubling that we’re going to have so many unemployed people in our communities,” Republican state Senator Steve Dille of Dassel said. “Every business is going to feel it.”

Of all HTI’s facilities, the Hutchinson plant was affected the most, with about 40 percent of its workforce being laid off. Fifty-five people lost their job at the Plymouth location, 100 in Eau Claire, and 275 in Sioux Falls.

“HTI’s workforce reduction is a result of the economic issues that are impacting businesses across the country,” HTI Vice President of Quality Kevin Bjork of Dassel said. “We have many talented employees, which makes this very difficult. However, it’s a step we have to take in light of market conditions.”

Many employees found out Jan. 12, but because of varying schedules, HTI continued to notify employees as the week progressed.

Company wide, 1,380 out of about 4,500 employees (roughly 30 percent) were laid off. The workforce reduction affected all types of positions.

“This is higher than the 20 to 25 percent that was announced on Dec. 9 due to a lower demand outlook for 2009 and continued market and economic uncertainty,” Pautz said.

Dille, who grew up with HTI CEO Wayne Fortun, said “hopefully this cut is enough to get the company stock back up and employ some of those people back in the future.”

Hutchinson Technology’s main product is suspension assemblies for disk drives. In 1996, the company also established a BioMeasurement division. Production will still be run in Hutchinson, but some of it has been consolidated into the Eau Claire plant.

“This allows us to run more efficiently at lower levels of production,” Pautz added.

Because the workforce reduction in Hutchinson was more than 33 percent, the Worker Adjustment & Retraining Notification (WARN) act requires HTI to give employees a 60 day notice before being laid off.

“Since we were not able to provide 60 days notice, employees need to receive their regular pay and benefits for the next 60 days,” Pautz said in an email.

In addition to the WARN act payment, HTI chose to give many employees a severance as well.

“Employees with up to four years of service receive 180 hours of pay,” Pautz added. “Those with four or more years receive 60 hours per year of service. Employees also receive an allowance to continue their health and dental insurance for two months. Severance benefits are reduced by pay received during the WARN period.”

A helping hand

To help those who have lost their jobs, many area churches are offering assistance. Gethsemane Lutheran Church in Dassel, working with Meeker County Social Services, put together a packet of resources.

“It includes programs and other resources people might not be aware of,” Pastor Steve Olson said. “Everything from energy assistance, to food assistance, to job services. It’s a nice resource, and we are improving it as we go along.”

Olson, who had been a licensed social worker before his call to ministry, said the help is “simply a matter of compassion.”

“These are people who have done everything right,” he said. “Through no fault of their own, they’re now in a difficult situation.”

Donations for unemployment assistance have been very generous, Olson said.

“In tough times, people do come together,” he said. “We are one of many churches working to provide assistance both financially and in terms of council dealing with unemployment.”

Donna Krautch, financial assistance supervisor for McLeod County Social Services, said the human services web site, www.dhs.state.mn.us, is a valuable resource for income and asset guidelines for state and county assistance.

Central Minnesota Jobs and Training Services is also offering help. Laid-off HTI workers and their spouses can attend meetings about employment and training services available through the Dislocated Worker Program.

Services available through the program may include career counseling and assessment, funds for training and retraining, funds for transportation, child care or emergency situations, suitable job leads, computerized job search assistance, and unemployment insurance benefits.

The eight meetings will be at the Ridgewater Community College auditorium in Hutchinson Tuesday, Jan. 20 through Thursday, Jan. 29. Those interested in attending may call 800-284-7425.


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