Saying that the projected long-term costs of keeping its mills in Crossett were “not economically viable,” Georgia Pacific announced a significant round of layoffs Tuesday.
The announcement followed the company’s decision to permanently shutter its bleached board operations at the Crossett mill.
The company also plans to close down its older tissue machines “that don’t support the long-term competitiveness of the tissue business,” a news release from the company said.
Company officials said approximately 530 workers will be impacted by the decision, including 25 sales and business office jobs. The extrusion plant, wood yard, pulp mill and a “significant portion” of the energy complex will be affected by the closures.
The tissue closure will be effective in July, while the bleached board closure will go into effect in October.
“Our Crossett employees have worked hard to safely and productively manage our operations there, and in recent years we have invested significantly in our operations. However, we have decided that the required investments needed for the bleached board machines, pulp mill and woodyard to sustain the operation long-term are not economically viable,” said Monty Brown, senior vice president – Consumer Products Group Operations. “We understand the impact this decision has on our employees, families and the community, and we will work cooperatively with the state and the community to minimize that impact.”
Approximately 500 employees will keep their jobs in support of the Crossett mill’s tissue production lines, which will remain open. The company spent approximately $60 million to open the newest tissue line, which began production in late 2018
The Crossett mill “will continue to operate and invest in the Crossett mill to support its consumer tissue and towel business,” the news release said. “The Crossett facility has premium product tissue and towel machines and associated converting equipment, so it remains a key contributor to the success of the Consumer Products Group’s retail business.”
The mill will continue to operate as it currently does until the October closure.
Company officials said they will being discussions with union officials in the next month about employees affected by the closures.
Those discussions will include the potential to transfer to other GP locations.
Crossett Mayor Scott McCormick said the decision would go beyond GP employees, rippling through the entire GP supply chain and the community at large.
“It is kind of hard to comprehend right now knowing that that many folks are going to lose their jobs,” McCormick said. “It is not just going to affect GP. It is going to affect anybody who has anything to do with the logging industry and the supply companies here in Crossett and other places. It is just a very disheartening and disappointing situation to be going through at this time.
“I feel for the employees who will be affected through this. My prayers are with them and I wish them the best. Other than that, I don’t know what to say.”
Crossett Economic Development Foundation Executive Director Mike Smith said CED would be part the response to help dislocated workers. He likewise said the CED would continue to look for industries to fill the gap left in the workforce.
“It is with sad hearts and many prayers that we reflect on the news about the job loss at the Georgia Pacific Crossett facility,” Smith said. “ As always, we are confident that the Crossett spirit will hold true and keep us moving forward.
“The Crossett Economic Development Foundation is committed to working with (Gov. Asa) Hutchison’s office and the Dislocated Workers Task Force to assist our local workforce in any way possible. As always, we are doing everything we can to recruit other industries to the area.”
The Naheola and Brewton, Ala., mills and the St. Marys, Ga., extrusion facility will take over production of the company’s bleached board product as the Crossett facility closes.
The Crossett announcement was paired with a larger round of closures around the Georgia Pacific manufacturing group.
The company announced that it would close particleboard facilities in Hope, Ark., and Monroeville, Ala.
GP also said it would not rebuild the Thomson, Ga., facility that burned last week in what the company described as a “catastrophic fire.”