POCATELLO — The Heinz Frozen Food plant here will be closing over the next six to eight months putting 410 people out of work. Pocatello’s facility is one of three that H.J. Heinz announced it is closing in North America and Canada. The Pocatello plant produces frozen meals and snacks.
“Our decision to consolidate manufacturing across North America is a critical step in our plan to ensure we are operating as efficiently and effectively as possible to become more competitive in a challenging environment, and to accelerate the company’s future growth,” Michael Mullen, senior vice president of corporate and government affairs for Heinz, said in a Thursday news release sent to the Journal.
The company said the move comes after “an extensive review of our company’s North American supply chain footprint, capabilities and capacity utilization.”
Heinz said it plans to offer severance benefits, outplacement services and other support to affected employees.
Other plants being idled by Heinz are the Florence, S.C., with 200 employees and, Leamington, Ontario, Canada, 740 employees. The plant closures were announced Thursday, eight months after billionaire Warren Buffett’s investment firm, Berkshire Hathaway, joined with another firm, 3G Capital, to buy H.J. Heinz for $23.3 billion. It was a move called the largest deal ever in the food industry.
Regional economist for the Idaho Department of Labor Dan Cravens said the bad news is a hard pill to swallow for Pocatello, which had an official unemployment rate of 7.8 percent in August.
“Closures like this are always a little difficult to deal with,” Cravens said.
In addition to the 410 direct jobs lost, Cravens estimates another 200 employment positions could be adversely impacted by the Heinz closure. The Idaho Department of Labor lists Heinz as one of the 11 largest private employers in Bannock County.
“With the holiday shopping season, this is not good news for retailers either,” Cravens said.
News of the pending closure also came as a blow to John Regetz, executive director of the Bannock Development Corp.
“It’s terrible news and you always feel badly for the people being laid off,” Regetz said.
Regetz said his organization will be working hard to collaborate with Heinz on selling the Pocatello facility to another food processor. He pointed out that the Heinz operation in Pocatello was singled out for recognition as being the most productive facility in the entire Heinz operation in 2011.
“It should be viable in the marketplace,” Regetz said about the facility.
Cravens shared that optimism.
“Once the site is vacated, it should be pretty marketable,” Cravens said.
In the meantime, Cravens said the Department of Labor will be doing all it can to help workers gain new skills and find employment.
“We will be doing all we can as an agency to help people affected by the Heinz closure,” Cravens said.
The announcement of a shutdown in the coming months followed the layoff of 80 Heinz employees last February. At that time, the company said the job cuts came because Heinz was ending its T.G.I. Friday’s line of frozen meals.
Heinz Frozen Food had its first layoff of employees back in September 2009, when it reduced the plant’s workforce by 65 people. Before those layoffs, the company had a workforce of nearly 800 at the plant.
The facility had operated as Kraft Foods until it was purchased by Ore-Ida in 1989. Ore-Ida is owned by H.J. Heinz.
Among the main products made in the Pocatello plant at that time was Weight Watchers meals.
The plant in Ontario was the first production facility for Heinz ketchup outside of the U.S. and was established in 1909. Leamington, located east of Detroit, Mich., has a total population of about 28,000.
Florence, S.C., has a total population of 37,000 and the Heinz plant there opened in 2011, according a story in The Florence Morning News. The same article said the Florence County Council had approved the sale of $3 million in special source revenue bonds in 2010 to reimburse the county for its expenditures in economic development projects including the Heinz plant there.