DeFehr consolidation to affect hundreds of jobs
DeFehr Furniture expects 85 to 95 of its employees will lose their jobs and others will be transferred as the Winnipeg company consolidates much of its manufacturing operations into one building.
CEO Andrew DeFehr blamed the high Canadian dollar and a slump in the U.S. economy for the consolidation of finished-goods operations in its massive manufacturing plant on Furniture Park in Winnipeg.
"The Canadian dollar basically wiped out the majority of our Canadian business, which that division was heavily focused on," DeFehr told CBC News on Wednesday.
The move will see much of the company's workforce and equipment move to the Furniture Park location, which will run at a higher volume.
"If you can do the same amount in one building, why try to run out of two?" he said.
65 jobs lost in Morden
Sixty-five employees at the company's plant in Morden, Man., will lose their jobs in the consolidation.
However, the president of the local chamber of commerce says the closure will not be a major blow to the town.
"We're a growing and thriving area in southern Manitoba here, and those people should not have too hard of a time finding a new job with … many of the industrial businesses that are in the area," said Carol Williams-Fehr, who also owns an employment agency in the town of 6,500.
"I've had a few come into my office recently and have put a couple of them already out to work, so there's work out there if you want it."
About 200 to 220 production employees and 46 administrative employees at the company's Pandora Avenue plant will also be affected, but most will move, not lose their jobs, DeFehr said.
"There will be some job loss, because not 100 per cent of the product that's being made there now will be able to be transferred over to our 125 Furniture location," he said.
"We're estimating right now … that about 85 per cent of the product will be retained, so that means there might be a 15 per cent reduction," he said. "There may be 20 to 30 [employees], initially, that we think won't be needed."
'There's a lot of business out there'
Ron Koslowski, spokesman for the Canadian Manufacturers and Exporters in Manitoba, said he believes the consolidation at DeFehr's was coming for some time.
"I know the industry, I know the business fairly well, and my sense is that they had some overcapacity … for some time," he said Thursday. "Possibly with some of the downturn, this is the opportunity to consolidate, to put it all together in one place and not have the overhead costs associated with large buildings."
Koslowski does not believe the changes at DeFehr are necessarily a sign that the manufacturing sector as a whole in Manitoba will see a financial downturn.
"Generally speaking … the manufacturing sector in Manitoba, at least our members are saying that … there's a lot of business out there," he said.
"Manitoba really is unique in Canada in that we have, I believe, the most diverse manufacturing sector spread fairly evenly across a whole region of sub-sectors in manufacturing."