Since Tyson Foods announced Jan. 25 that it was eliminating 1,500 jobs with the closure of its local slaughter operations, company employees have been trying to figure out what their next step will be.
"Many families are thinking about leaving," said Maria Landeros, owner of Maria's Mexican American Imports, a small retail shop that caters to Hispanics in Emporia. "We want people to stay."
Clelia Portillo said she and her husband have lived in Emporia for 10 years. Because they believed his job at Tyson Foods was secure, they bought their first house six months ago. They have one son.
"We never expected this to happen," Portillo said through an interpreter. "But my husband is losing his job."
Landeros said she has talked to many people like the Portillos who are worried.
"There is lots of stress and crying," she said.
The economic impact of the layoff is sweeping and will affect the city, schools, businesses, restaurants, the housing market, the ranching community and social services. Banks will see a massive reduction in payroll checks.
When the layoffs are complete, about $40 million of the Emporia Tyson Foods plant's $70 million in annual payroll will have been eliminated.
City officials said the Tyson plant is responsible for 20 percent of Emporia's water collections, paying the city $876,000 in water fees last year.
But local officials say Emporia is prepared to weather the crisis. Before the layoff announcement, Emporia was doing fairly well. Its downtown appears to be thriving with most storefronts full. Emporia State University remains a strong, viable institution with 6,000 students. Several industries have announced expansions and investments in Emporia, including Hill's Pet Nutrition, which will start construction this year on a $100 million plant that will employ 100 people beginning in 2009.
Kent Heermann, president of the Regional Development Association of East Central Kansas, said Renewable Energy Group began construction last year on a biodiesel plant at Emporia. It will employ 30 people when operations commence in 2009. The builder stopped construction over the winter, but when construction starts up again it will create 100 jobs.
Another project coming to the area is a 600-megawatt, natural gas-fired combustion turbine plant being built near Emporia by Westar Energy.
Emporia has a population of about 26,200 people.
"If this hadn't happened (the layoff), we might have seen a 1 percent increase in population," Heermann said. "Maybe in the next census, it will be down slightly. We don't know yet."
Heermann has been studying the impact of a similar layoff in Norfolk, Neb., a town of 24,000 people.
Two years ago, Tyson Foods closed its beef slaughter operations in West Point, Neb., eliminating 365 jobs and shut down its beef processing plant in Norfolk, Neb., eliminating 1,300 jobs.
"We didn't see it coming," said Dan Mauk, president of the Norfolk Area Chamber of Commerce. "We lost $32 million payroll."
He said sales tax receipts remained flat in Norfolk.
Mauk said about 1,000 workers left Norfolk. Many were from Somali and Sudan.
"They were gone, you don't see blacks anymore," he said.
Unemployment went from 3.6 percent to 4 percent by July 2006, but rebounded to 3.1 percent by the end of the year in Norfolk. That may appear healthy, Mauk said, but the reason unemployment remained low was because so many people left town.
No one knows exactly how many students will leave the public schools, but many children of Tyson Foods employees attend Emporia Unified School District 253, residents said.
The district has 4,809 students. Of that number, about 2,000 are Hispanic and 200 are black, according to Kansas State Department of Education statistics on its Web site.
The state provides $4,374 per pupil in aid to schools in Kansas. If the school district loses 500 students, for example, it would lose $2.1 million in state aid.
The district spent $13.5 million building two new elementary schools to accommodate more students in 2003, according to Susan Hernandez, assistant superintendent of business at USD 253.
Riverside Elementary School was built on the southwest side of the town, and Timmerman Elementary School was built on the northwest side.
"We built the schools to educate the kids, and now they may leave," said Harry Fowler, a longtime rancher in Emporia.
Tyson Foods was slaughtering about 20,000 head of cattle per week, well below its capacity of 28,000 per week, according to company data.
Now that stream of cattle will have to go elsewhere for slaughter. Ranchers said cattlemen who were feeding cattle to finish for slaughter at Tyson Foods will be affected.
"It may cost more to ship them," Fowler said.
He said truckers come into Emporia every day to drop off cattle.
"They won't be here anymore," Fowler said. "This will impact everybody."
Michael Hooper can be reached at (785)295-1293 or [email protected].
Source: CJONLINE, Feb 03, 2008