Job Market Tightens as Layoffs Spread

By Beacon Staff

Elaine Badley has worked at Semitool for the past eight years. Now, following her Nov. 10 layoff along with 99 other employees, she enters what she calls the “world of the unknown.” Indeed, with a shortage in federal funding for displaced workers’ programs and a destabilized job market, the Flathead is a land of uncertainty for those looking for work.

And there are a lot of people looking for work.

Laura Gardner, supervisor of Flathead Job Service in Kalispell, said on a recent Monday 600 people, nearly three times the average in October, came into her agency in hopes of finding a job. But the agency doesn’t have a lot to offer them, with its lowest number of job postings since 2002. The resourceful staff there does what it can, but the truth is that many people walk away empty-handed.

“It is a pretty dismal market right now,” Gardner said. “With the Semitool group, the job outlook right now is not a really positive one.”

The layoffs at Semitool’s Kalispell and Libby plants come on the heels of this summer’s massive restructuring at the Columbia Falls Aluminum Company, when about 120 people lost their jobs. Also, Plum Creek Timber Co., in response to a slumping woods products industry, has made significant cuts in recent months. Semitool, CFAC and Plum Creek are three of the valley’s largest employers.

Barbara Wagner, senior economist for the Montana Department of Labor and Industry, said unemployment statewide is 4.6 percent, without being seasonally adjusted, which is up from 3.6 percent at the beginning of the year. Flathead County’s rate is also 4.6 percent, a substantial rise from last year.

“That dramatic increase is a concern,” Wagner said.

Though the county’s unemployment rate is on par with the state’s, Wagner said the Flathead region has been hit considerably harder by economic hardships than the rest of Montana. Much of that is because large industries, including timber, are bearing the brunt of the damage here.

In bad times, big companies occasionally lay off large numbers of employees, significantly impacting the job market, while smaller companies in retail and other sectors lay off one or two workers at a time, if any at all. The eastern part of the state has actually enjoyed a decent year because of high commodity prices.

“The economic downturn has hit Flathead and the northwest region of the state the hardest,” Wagner said.

The good news for the ex-Semitool employees is that they qualify for Trade Adjustment Assistance (TAA) aid. Laid-off CFAC employees learned they too qualify for TAA, as well as a federal emergency grant. Flathead Job Service is offering classes about TAA for both Semitool and CFAC employees this week. But many CFAC employees are still having a hard time getting a job, Gardner said.

“They’re coming back saying, ‘Boy I’m just not finding work – what can I do?’” Gardner said.

Gardner recommends laid-off workers file for unemployment, research what benefits they qualify for and make sure their resumes are in order. She warned, however, that “it’s hard to get through to the Helena unemployment division because they’re getting so many calls from around the state.”

Semitool, founded in Kalispell in 1979 by Ray Thompson, is a top manufacturer of semiconductor equipment used in electronics. Including offices in Asia, Europe and Australia, the company has roughly 1,300 employees, about 800 of whom are located in Montana. Its headquarters are in Kalispell. Company officials said the Nov. 10 layoffs were due to the slumping economy.

A day after the layoffs were announced, Semitool posted a net income of $1.2 million and overall revenue of $60.1 million for its fourth quarter. Last year, the company reported a loss of $1.5 million for the fourth quarter.

Badley said she is only a few years away from retirement, but her layoff may push that back. Also, she says her 401(k) has no value because of the poor stock market. She is currently looking for a new job, though she’s not sure in what field exactly. In the meantime she’ll collect unemployment. This is the second time in her life she has been laid off by Semitool, which has had a series of cuts since the mid-1990s.

“I still have a mortgage under my belt,” Badley said.

Her son Jeremy was also laid off, which she said is a more urgent situation because he has two kids, ages 4 and 8. Fortunately for the Badleys, Jeremy’s wife, who works in customer service at Semitool, still has her job. Jeremy said he was surprised he was among those laid off, though he and Elaine both said most employees knew cuts were coming.

“Half of my immediate family is unemployed,” Elaine said.

Within days of his layoff, Jeremy, a former electronics technician for the Navy who operated a CNC machine and worked in the plastics department at Semitool, had already sent out a number of job applications. He would like to stay in the technology field, but he acknowledged the job market isn’t terribly inviting and he’ll ultimately take what he can get.

“There’s jobs out there but it’s just what you’re willing to do or willing to take,” Jeremy said. “Admittedly there’s not a huge plethora like there was a couple of years back.”

Both Elaine and Jeremy said their severance packages are good, giving them a week’s worth of pay for every year they worked at Semitool: eight weeks’ worth for Elaine and three for Jeremy. They also receive money for their accrued vacation and sick days.

The severance money will help get through the holiday season and the slow winter months, but the Badleys are making adjustments to their daily life nonetheless. Elaine canceled her cell phone. Jeremy is sending his daughter to school with the neighbors to cut gas costs and has downgraded to the slowest, and cheapest, Internet speed while eliminating long distance minutes on his phone.

“We trimmed the fat off of that to reduce the bill,” Jeremy said. “We’re not in panic mode yet.”

Gardner, like the Badleys, is hoping the economy will begin to pick up again next spring, which is little consolation for the large numbers of people currently unemployed. Gardner said federal grants for displaced workers are based on employment, and since Montana previously had low unemployment rates it is now receiving little federal assistance. That won’t change until at least July, when new funding is allotted, but even then Gardner isn’t sure whether any more money will come Montana’s way.

Both Gardner and Wagner said massive layoffs have far-reaching effects on the overall local economy, which is already struggling.

“We’re certainly seeing a ripple effect in all segments of the economy,” Gardner said.