CF plant to lay off about 35

Plum Creek announced on Thursday that it will lay off about 35 workers from its medium-density fiberboard plant in Columbia Falls.

Citing a flat housing market and declining demand for wood products, the company said those layoffs will come as it reduces the number of rotating shifts from four to three beginning on Sept. 29.

The laid-off workers represent 19 percent of the plant's 185 production employees.

Those affected generally work on the production line and have been with the company two years or less, Director of Communications Kathy Budinick said from Plum Creek's Seattle headquarters.

Calling the sharp decline in the housing market the "primary driver" for the layoffs, Budinick said conditions at the time they were hired were drastically different from today's.

"I don't know that we would have anticipated this kind of a challenge in the markets," she said. Plum Creek has been able to maintain the facilities well enough to hold production levels until now, she added, but "the decline means we've got to make some changes."

She said company leaders following the market do not anticipate any significant market upswing before the middle of 2009.

"We're hoping that by mid- to late-'09 things improve and, as they do, we'll evaluate stepping up production again," she said.

Hank Ricklefs, vice president for Northern Resources and Manufacturing based in Columbia Falls, explained the company's decision in a press release on Thursday.

"What happens in the national economy affects our business in Montana," Ricklefs is quoted in the release. "News about the housing market continues to be gloomy and these market conditions have a direct impact on demand for our wood products. This change in the shift schedule will allow us to operate more efficiently until the market improves and we are then able to step up production."

Budinick said the plant's 24-hour, seven-day-a-week production schedule will be curtailed to 24 hours five days a week. The plant will not be in production on Saturdays and Sundays.

The medium-density fiberboard plant produces goods that are most directly impacted by the housing industry, including flooring, interior moldings and doors.

The 35 workers officially were told of the layoffs on Wednesday. Budinick said they are being encouraged to apply for specific openings at Plum Creek's other facilities in Evergreen and Columbia Falls.

No transfers are guaranteed, however. Those who do not win another position within Plum Creek will receive severance benefits.

This week's announced layoffs follow cutbacks at other Plum Creek lumber mills in Columbia Falls, Evergreen, Ksanka and Pablo.

"We are watching the situation closely, and had to make adjustments," Budinick said. "Of our six lumber facilities in Montana, we had to reduce production and reduce inventory at four of them because demand is down."

She said Plum Creek did not lay off workers at the other four plants but cut back their work schedules by 40 hours a month. Those curtailments take effect today.

As another cost-cutting measure, workers at the Columbia Falls plywood plant will be required to take their vacation time over the holidays this year, she added.

Budinick said she has no information on further Plum Creek layoffs at this time.

"We will just continue to evaluate the need to make adjustments," she said.

Reporter Nancy Kimball can be reached at 758-4483 or by e-mail at nkimball@dailyinterlake.com