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Construction slump led to JLG layoffs

September 06, 2008|By DON AINES

McCONNELLSBURG, PA. - A continuing slump in the market for construction equipment is the reason JLG Industries will cut 220 positions in North America next month, according to company officials.

Last week, JLG announced layoffs affecting 220 people in its McConnellsburg, Bedford and Shippensburg facilities in Pennsylvania, along with plants in Orrville, Ohio, and Oakes, N.D., Vice President for Global Marketing Kirsten Skyba said Friday.

The new round of reductions will take effect Oct. 3 and are considered "indefinite" in that they could be permanent unless and until market conditions change, Skyba said.

"We have continued to face very difficult conditions in the construction market where much of our lifting equipment is used as well as a cautious buying environment with our customers in North America and Western Europe," JLG President and Oshkosh Corp. Vice President Craig Paylor said in a statement Friday.

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"Since late July, when we realigned our production schedule and announced a reduction of approximately 600 positions, we have seen more deterioration in product demand," Paylor said.

A JLG employee said earlier this week that about 150 workers are to be laid off in late September as part of the previously announced round of layoffs and that the Oct. 3 layoff will affect about the same number of people. About 125 had been laid off on Aug. 1 and there was a smaller layoff in late August, the employee said.

A Pennsylvania Department of Labor and Industry spokesman confirmed those numbers on Thursday.

"These are difficult decisions and were made only after careful consideration. A work force reduction is never easy and this one was unavoidable," Paylor said. The company is working with state and local agencies to assist the laid-off employees, he said.

"We realize announcements like this are challenging, especially after we recently completed a great third-quarter sales result, but with the continued deterioration of the nonresidential marketplace as well as the upcoming seasonal impact on our largest market segments, we must remain conservative," Paylor said.

Oshkosh, which acquired JLG in December 2006, reported $2 billion in third-quarter sales, up 6.6 percent from the previous year's third quarter.

"We've weathered market cycles like this before - the last time in 2001 and 2002 - and view this downturn as temporary," Paylor said. "Then and now, we made the tough decisions required to face the situation, and come back stronger than ever when the market rebounded."

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