While the effects of a slow economy echo through the halls of congress and still factories across the nation, last week it hit a little closer to home. In less than eight weeks Northern Engraving will close its Spring Grove plant after over three decades of operation. Layoffs of the approximately 250 employees will begin mid February and occur over a two or three week period as production is shifted to Sparta or West Salem. It is estimated that approximately 50 employees reside in the Caledonia area.
Northern Engraving, celebrating its centennial year, is a leading supplier of nameplates and decorative trim for brands such as Whirlpool, Electrolux, Honeywell, and corporations like General Electric and General Motors. Sparta, WI is home to their corporate headquarters, but they also host manufacturing plants in Holmen, West Salam, and Great Britain.
Vice President, Ed Johnson, indicated the decision to close the plant is attributed to declining sales as a result of a weakened economy.
In an interview he further explained, “Northern Engraving finds itself with significant overcapacity with relation to the North American auto market and the slow down in the economy. Bottom line costs is what caused the decision.” Johnson also states, “the decision is not an easy one, but it is the kind of consolidation that all responsible businesses are going through in this economic downturn.”
Aware that Northern Engraving manufactured emblems for Dell computers, I asked Johnson if it was likely the logo on my computer was manufactured in Spring Grove. He explained that at one time they were, but Dell no longer orders parts from Northern Engraving. Instead, Dell purchases from low-cost manufacturing. Low-cost manufacturing is a more formal descriptor for overseas manufacturing where products are produced cheaper. While the slow economy is to blame for much of the slowdown, companies importing products from overseas can also influence Northern Engraving’s business.
“Our decision in Spring Grove has nothing to do with the quality or capability of the workforce,” Johnson reaffirms area residents. “The Spring Grove community and the larger area of Minnesota has been a wonderful place to have done business.”
While Johnson stated that approximately 50% of Northern Engraving’s output is for clients in the auto industry, Marylin Thomford, a 19 year employee, explained that the past three or four years a majority of the work in the Spring Grove facility focused on appliances.
Thomford was surprised by the decision to close the plant, stating, “it surprised everybody. Even the superintendent didn’t seem to know.”
Eyebrows were first raised when the second shift supervisors reported to work earlier than usual to attend a meeting Thursday afternoon, Dec. 11, with company officials. After the meeting, word of the decision quickly spread to the workforce and throughout surrounding communities.
The reactions she’s witnessed from coworkers tell a story of bewilderment.
“People have no idea what they are going to do. There are no jobs out there.”
Thomford is going to retire a few years earlier than originally planned and believes there are quite a few people of retirement age who will likely do the same.
Karen Folstad, Spring Grove mayor, was also surprised at the news.
“We thought things were picking up,” said Folstad. “Talking with the workers, they indicated they were looking at contracts for appliances and other work to fill the gap.”
Folstad and other city officials are exploring how this will affect the community. In addition to less patronage at local businesses, she fears the loss of a major employer like Northern Engraving could also affect school enrollment if people move away to find other jobs. She hopes to discuss with Northern Engraving officials the prospects of keeping the factory open or potentially selling the property to another business that would bring jobs to the city.
All of this comes only days after good news swept the city. Two weeks ago it was announced by US News and World Report that Spring Grove Secondary received a bronze rating in their Best High Schools analysis. A bronze rating indicates overall student performance was above the state average and the performance of the least advantaged students, (i.e. racial minority, low income) also ranked above state average, indicating the school serves all students well. 1,321 high schools in 48 states received this rating.
Northern Engraving closed its plant in Waukon only a few months ago. Waukon mayor, Keith Schroeder, indicated the transition hasn’t been easy. While many former employees found work in Decorah, or even at the Spring Grove Northern Engraving plant, others used the opportunity to go back to school.
Despite their efforts, Schroeder said, “Nothing has moved in to fill that gap. We had a couple nibbles here and there but it’s awful hard to get them to come. It’s going to take time. Its not an overnight thing.”
Sharon Corcoran will mark her 30th anniversary of employment for Northern Engraving January 8th. While Corcoran was surprised the decision to close the plant was announced now, she assumed it was only a matter of time.
“They closed Galesville, Lansing, Waukon, but they’ve been doing it in two year intervals, so I thought maybe we’d have another two years. You know its going to happen. I just thought we had a little longer.”
Fortunately, Corcoran currently works part time for ABLE in Caledonia. With her pending unemployment from Northern Engraving, she hopes to eventually go full time. She is particularly grateful for ABLE’s willingness to work with her and give her more hours when her work at Northern Engraving occasionally got cut back.
In explaining the mood of coworkers she said, “I think everybody is sad, not just for losing the job but losing friendships. I think they’re scared. In rural communities there aren’t very many jobs and with the economy the way it is, it’s scary.”
Despite the disappointment in the announced factory closing, Corcoran remains thankful for the job it has given her the past 30 years, always providing her family with shelter, clothing, and food.
Johnson indicated they plan to hold on to the property for awhile although no immediate plans for the property exist. It is not expected they will reopen the plant although some remain hopeful they will. In 2002 Northern Engraving announced they would close their Galesville plant only to reverse that decision a few months later due to “changes in business circumstances.” The Galesville plant did eventually close in 2006.
“We expect to be able to rebound as the economy rebounds,” Johnson said while explaining what the future holds for the company. “We are opportunistic that the US economy is strong and vibrant and we will rebound. We are in tough times right now, it will eventually turn and when it does we will go with it.”
Whether or not a rebounding economy could bring Northern Engraving back to Spring Grove is a question that only time will answer. For now, work continues as employees work through their final weeks of employment and prepare plant operations for the transition to Wisconsin.
