Maytag announcement leaves community on edge

Maytag announcement leaves community on edge
Date June 04, 2004
Section(s) Local News

NDN Staff Writer

Hours after news hit Newton of the Maytag restructuring plan that will eliminate 1,100 salaried jobs, residents were talking about it. Talking in P.J.’s Deli. Talking in the Scoreboard bar. Talking on street corners, even. And while news of the loss of more Maytag jobs may not have been a complete surprise for many, it still left people wondering what’s going to happen to Newton in the long run.

In a conference call Friday morning, Maytag CEO Ralph Hake said about 600 jobs would be eliminated from Newton-based Maytag Appliances and Maytag Corporate Headquarters — part of 1,100 total salaried jobs eliminated in a company-wide restructuring move.

Some of those jobs were eliminated immediately on Friday. The rest will follow by the end of the year, Hake said. No numbers on exactly how many employees have already been terminated were available Friday afternoon.

Not all 600 of the positions to be eliminated have been identified yet and not all 600 will come from Newton, Maytag Spokesperson Lynne Dragomier said. The uncertainty surrounding just how many Newton jobs will be lost leaves some local employees who survived Friday’s cuts uncertain about their future.

IT’S A FEELING Newton Mayor Chaz Allen knows all too well. Before coming to Newton, Allen worked for MCI in Cedar Rapids during a time when the company was downsizing. He recalls fearing for his job on a regular basis.

“It’s tough,” he said, “I’ve been through that — showing up at 6:30 in the morning and waiting for a tap on the shoulder.”

The sheer number of jobs cut came as a surprise to the mayor. He said he and the council would do everything they can to help bring more jobs to the community, but that there’s nothing the city can do directly to keep Maytag jobs in Newton. Even with the loss of jobs, Allen thinks Newton will be all right.

“This is a resilient community,” he said.

The mayor has been talking with Governor Tom Vilsack for the last several months about the situation at Maytag. On Friday, Vilsack left a message on Allen’s cell phone offering support.

“I know this is a very difficult day for the Newton community,” Vilsack said in the message, adding that the state Workforce Development office would offer “significant” help in the form of unemployment benefits and training resources for Maytag employees who lose their jobs.

The Governor further said that the Economic Development Department plans to “visit with Maytag officials to see if there’s any way in which more opportunities might be explored to create new business or job opportunities at Maytag over the long term.”

Sen. Tom Harkin also released a statement Friday saying “I am deeply disappointed that Maytag significantly reduced its salaried workforce at the Newton facility. This will hit a lot of Iowa families very hard. … I will be doing all I can to make sure that laid off workers get the assistance they need to get back in the workforce as soon as possible.”

LOCALLY, BUSINESS owners on the square reacted to the news about what job losses at Maytag mean for them.

“We’ve noticed a drastic change in the way business goes,” said Cory Walker, owner of the Scoreboard. “The people who got laid off or fired in the first round of layoffs obviously changed their lifestyle. And the rest haven’t known what’s going to happen next, so some of them have changed their lifestyle, too. That affects a lot of people.

“People may still come and buy drinks, but you can definitely tell a difference in food. People decide it’s just cheaper to eat at home. The people who have cash are scared to go out now, and that affects us quite a bit. We used to be packed on Thursday and Friday nights, but now we run a smaller staff.”

Kerry Walker, manager of Randa’s Appliances and Electronics on First Avenue, thinks the layoffs will be bad for his business, too, particularly because of public sentiment toward Maytag and the fact that people scared about their jobs won’t buy big ticket items. He estimates 90 percent of the merchandise he sells is Maytag products.

“It’s definitely going to hurt. It’s going to hurt saleswise and (cause) fear — It just creates a lot of turmoil in town and turmoil with customers who walk in,” he said of the cuts.

Re/Max of Newton owner Barb Barr isn’t sure what the restructuring of Maytag will do to the local housing market. Recent layoffs at Maytag hadn’t impacted the market very much, she said, but Friday’s announcement included far more job cuts than the approximately 300 plant workers laid off in the last several months.

“We’ve never been through this before so we don’t have the answer,” she said.

NEWTON RESIDENTS also reacted with concern on Friday.

One man, who asked to remain anonymous for fear of retribution for his comments, said he thought the layoffs might have been necessary. He said the cuts did not surprise him because he doesn’t think Maytag values being in Newton.

“There’s absolutely no one on the board of directors or in upper management that has a real commitment to Newton,” he said.

The man said he’s most worried for young people in Newton and that the loss of the jobs may force some people to leave town.

“No doubt we’re going to lose really worthwhile people who could have helped the community,” he said.

Newton Senior High School student Megan McNeill might be one of those people. Although neither she nor her family work for Maytag, she’s concerned about what the job losses will do to the community.

After she graduates from high school next spring she plans to go to college at the University of Iowa. McNeill doesn’t think she’ll ever live in Newton again after that.

“I don’t feel after I get done with college that there will be the same kind of Newton.” she said. “I don’t really think there’ll be a Newton to live in.”

NDN Staff Writer Mandi Lamb contributed to this report


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