Still too soon to see long-term effects; spending habits of employees may change immediately, experts say

SPOTLIGHT PHOTO: COURTNEY VAUGHN - Armstong World Industries, a global corporation headquartered in Pennsylvania, announced last week it would be closing the St. Helens plant in mid-2018. The company currently employs 130 people at the facility.UPDATED: The closure of Armstrong World Industries, a top 10 taxpayer in Columbia County, is bound to have a significant impact on the local economy, sources familiar with the county and city of St. Helens' economic landscape indicate.

Armstrong, which operates a ceiling tile manufacturing plant in St. Helens, announced Nov. 21 plans to close the facility in mid-2018. The plant employs 130 people locally.

In 2017, Armstrong paid $402,577 in taxes to the county, of which $13,670 is distributed to the city of St. Helens. Armstrong is also a city water ratepayer and the city receives franchise fees from Columbia River People's Utility District based on revenue it generates in a given year from electric customers.

City Administrator John Walsh said city officials are projecting how the loss will impact the city before the 2018-19 fiscal year budget planning cycle. He noted, however, that it's too soon to say how future water and sewer rates for other customers will ultimately be affected by the loss of the company.

Libby Calnon, community and public relations supervisor for CRPUD, also said it's too soon to know what the full impact will be on franchise fees or electric rates. The franchise fee the PUD pays to the city for revenue generated in 2018 won't be made until March 2019.

The PUD will likely look at that impact during its mid-year review, Calnon said.

Of greater significance, Walsh emphasized, is the effect the shutdown will have on Armstrong employees.

"It's people and their lives," Walsh said. "It's the whole livability aspect."

Shawna Sykes, a workforce analyst with the Oregon Employment Department, said Columbia County does not have the capacity to absorb 130 jobs into career positions that would correspond directly with the employees current roles. According to information from Armstrong, the jobs will include roughly 30 administrative positions and 100 manufacturing jobs.

There are few openings in the local job market for labor or production positions, Sykes said, adding that it's likely employees would need to retrain for other jobs or commute outside the county to find employment.

A spokeswoman for Armstrong previously declined to comment on salary information regarding employees at the St. Helens plant, but Sykes points out that the manufacturing sector is one of the county's higher wage industries.

In 2016 the average salary was $53,000 a year in that sector, Sykes said. While, salaries vary based on each individual company and employee, the elimination of roughly $6.9 million in payroll employment "is huge."

"And you think about the impact of that, it isn't just the payroll. It's all of those folks spending money in the community," Sykes said. "Everyone who touches those employees will be affected."

The financial impact of the layoffs is expected to affect the employees' current spending habits, Sykes explained. People may spend less at local businesses during the holiday shopping season, for example, she said, or families may spend less on groceries or find other ways to cut back.

The impact on long-term finances, such as property taxes, probably won't be realized until next fall when tax assessments are completed, she added.

On the other hand, Sykes explained, unemployment across the state is low and the economy has edged out of a recessionary period.

Walsh echoed similar sentiments.

"The best part of this is that we're in a good economy," Walsh said. "It's not like when the [Boise Paper Mill] shut down in 2008 and there weren't really even alternatives to find work outside of the county."

Armstrong has offered job placement services for all employees and has stated that there are "opportunities for employment at our other plants for employees who both meet the job requirements and who would consider relocation," a spokesperson for the company said.

Chuck Daughtry of Columbia County Economic Team said he is planning to work with Armstrong throughout the closure to help the employees find work.

As an economic development official, Daughtry said he also plans to promote Armstrong's building site as a good place for other manufacturers and businesses to locate.

Editor's note: This story has been updated to clarify what employment services are being offered to employees by Amstrong World Industries.

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