Dow trimming La. jobs; 260 laid off around area

• By GARY PERILLOUX
• Advocate business writer
• Published: Jan 31, 2009 - Page: 1A - UPDATED: 12:25 a.m.

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In a move dreaded for two months, Dow Chemical Co. said Friday that it’s eliminating 260 regional jobs — high-paying chemical jobs in Plaquemine and Hahnville — that could quicken the pace of a national recession into the Baton Rouge and New Orleans metro areas.

Some people losing jobs will gain Dow retirement benefits (the company wouldn’t say how many), but the bottom line equals about $15 million to $20 million in annual income that will go away from the Louisiana labor force.

That impact broadens with a 25 percent reduction in contractor jobs at Dow’s Plaquemine facilities since November, which means another 400 maintenance jobs won’t return unless the economy somehow rejuvenates.

“This is going to be a hit,” economist Loren Scott said Friday, calling it a “good news/bad news” day. The U.S. government said Friday that gross domestic product — the key barometer of economic growth or contraction — fell 3.8 percent in the fourth quarter, less than the 5 percent to 7 percent range that had been feared. “That’s not as bad as it figured to be, but this is clearly not good news from Dow, especially since this is considered a permanent cut.”

The 160 direct Dow jobs being eliminated in a 10 percent cut at Plaquemine, combined with a contractor base that’s off 400 jobs, means that the Louisiana Operations soon will have shed 560 jobs from a peak of 3,100 in 2008.

Dow said recent decisions to mothball some of its underperforming units, bundle other chemical lines into a joint venture, and buy specialty chemical maker Rohm and Haas Co. were behind the jobs cuts more than current economic events. Those strategic moves have been complicated by the unraveling of a Kuwaiti joint venture that left Dow without the capital needed to by Rohm and Haas for $15.4 billion.

The 25 percent reduction in Dow’s contractor force in Plaquemine, however, is linked to the economic downturn, the company said.

“The decision to eliminate jobs is never one we take lightly,” said Sharon Cole, the Dow Louisiana Operations site leader, in a statement. “But today, for Dow, it is a step we must take to ensure our company continues to thrive and perform.”

At Dow’s Union Carbide subsidiary in St. Charles Parish, about 100 jobs are being eliminated, leaving 1,000 people directly employed by Dow there. The St. Charles contractor base has returned to pre-holiday levels of about 1,000 and hasn’t dropped, said Tommy Faucheux, public affairs manager for Dow’s Hahnville group of 18 processing plants.

“For the most part, it will take place over the next month as we get toward the end of February,” Faucheux said of the job reductions, but some eliminated positions could last longer.

Stacey Chiasson, Dow’s Louisiana public affairs leader, said affected employees have been told about the decision in individual meetings this week.

“It truly is across the board,” she said. “Not one job function has been (spared).”

Key to Louisiana’s ability to ride out the recession well, Scott said, will be whether such petrochemical heavyweights as Exxon Mobil Corp., BASF and Royal Dutch Shell — which employ thousands in East Baton Rouge, Ascension and St. Charles parishes — follow suit or retain their jobs.