Stung by tough overseas competition, the Electrolux Group officially will shut its freezer factory in St. Cloud on Friday, displacing about 700 workers.
The company is consolidating its Minnesota manufacturing operation into two existing plants in South Carolina and Tennessee.
The shutdown, first announced in January 2018, displaces about 600 workers this week. An additional 40 maintenance workers, 35 line workers and about 10 union members will remain at the 45-acre campus for several weeks to clean the building and equipment that will eventually be sold.
The last of the workers will be laid off in waves between now and March, union officials said.
All week, employees reached out to their job coaches, consoled one another and signed the photo-filled Electrolux history yearbook that workers put together to commemorate the plant that has been an economic force in the region since even before Electrolux bought the refrigerator factory, warehouses and training facilities in 1986.
On Friday, employees are expected to sign the last freezer that rolls off the production line and to donate it to a local museum.
“We have a lot of employees who only know Electrolux. It’s the only company they have worked for,” said International Association of Machinists Local 623 union representative Geny Ulloa.
“There are generations that worked there, entire families,” said Cathy Mehelich, economic development director for the city of St. Cloud.
In recent years, the plant that for decades manufactured Frigidaire refrigerators and freezers and other products has been pinched by overseas competitors.
Fifteen or so years ago, Electrolux’s St. Cloud factory boasted 1,700 workers. By January 2018 it employed just under 900. Today there are nearly 700 making a rough average of $18 an hour.
Electrolux has worked with the state and city for months to help affected workers.
Sarah Saito, who runs the federal Trade Adjustment Assistance (TAA) program for the Minnesota Department of Employment and Economic Development (DEED), said only 35 workers signed up for TAA benefits that offer job retraining, job search and relocation allowances, a wage subsidy for displaced workers over 50, and a health care coverage tax credit through the Internal Revenue Service. She said she expects more displaced workers to file applications in the next few weeks.
“It’s a big transition for people to lose their job,” Saito said. “We hope people know that resources are available.”
“I’m a little anxious,” admitted Joe Baratta, an 11-year Electrolux employee who also serves as the union’s shop committee chairman. He will stay on to help shut the plant for an unknown number of weeks until his official layoff notice arrives.
Baratta had just purchased a new truck in January 2018 when he learned his factory was shutting down. “I hadn’t even made my first payment on the truck when all of a sudden I hear, ‘We are closing,’ ” he said. “With the Trade Adjustment Assistance [program] I will go to automotive school.”
Six co-workers will be right there with him. Four line workers plan to get their commercial trucking licenses, while a former supervisor is headed to nursing school. “I am hopeful that all my members can take advantage of all the job-retraining assistance they can and walk out of here in a better position than when they came in,” said Baratta.
Ulloa, the IAM Local 623 representative, said he too hopes more of his members begin seeking help.
Ulloa said many worked at Electrolux so long that “they are intimidated by the idea of going back to school” to reinvent themselves for other careers.
Many never graduated from high school. Others are immigrants who fear their English skills are not strong enough to tackle college or skills certification classes. Still others are not willing to relocate.
Electrolux said displaced workers can apply for jobs at the company’s five factories in other parts of the country.
“But no one has taken them up on that,” Ulloa said. One reason? Workers are tied to the local union pension plan and fear giving up retirement funds, should they make the move.
While workers say they want to stay in the area, only about 50 enrolled in a skills apprenticeship program offered by the city, union, DEED and St. Cloud Technical and Community College. “We were surprised about that and wondered why more people didn’t take advantage of that,” Ulloa said.
Saito is not surprised. After Friday, some will formally file for unemployment and begin navigating job opportunities or skill retraining services with the help of job counselors at Career Solutions.
The laid off “are making the best they can out of a tough situation,” Saito said. “They have had time to go through all these emotions. And they are probably just now at a point where they can make plans and act on them accordingly.”