CHILLICOTHE, Ohio — Widespread layoffs have been issued at Kenworth in Chillicothe.
The layoffs were announced at plant-wide meetings on Thursday. According to employees, the layoffs at the factory known for making semi trucks will impact anyone hired since April 2020; the factory is the second largest employer in Ross County.
While the parent company — PACCAR — did not release an official statement, employees said the layoffs will go into effect two weeks from today on September 10.
Employees also told the Guardian that 350 employees were told to pack their bags, but PACCAR did not confirm that number on Thursday.
It was exactly one year ago this month that the trucking factory had their last round of layoffs. During the 2020 plink slip express, the plant was idled for two weeks to prepare for the layoffs. 500 of the factory’s 1,600 workers were impacted, but many were recalled a few months later. It was unknown how long this round of layoffs would last.
Newer employees who were not familiar with the layoff process were frantic for answers on Thursday. Some of them contacted the Guardian asking how they could apply for unemployment, or if they were qualified for the benefits. The average new-hire at Kenworth takes home approximately $2,600 a month, according to paystubs.
According to the state, the maximum unemployment benefits amount a Kenworth employee can earn if they do not have any dependents and have weekly wages of over $886 during the base period, is $443. If workers have 1-to-2 dependents and have weekly wages of over $1,074, the maximum benefit amount they may earn is $537.
On the local level, government will hurt from a decrease in tax revenues.
“That is a more appropriate question for the City Auditor, but to answer your question, it will hurt the City of Chillicothe’s income tax revenue for the upcoming quarter,” said County Auditor Tom Spetnagel. “Fewer jobs equal fewer taxable dollars …. the effect on the city is 2% of earnings during the period they are laid off. If there are 350 people making an average of $50,000, that is 350, multiplied by 50,000 multiplied by 2%, equals $350,000 loss over the course of a year.”
Several hundred Kenworth trucks have already been manufactured and sit idle on land at the Ross County Fairgrounds. The reason the trucks are there is because the company lacks a microchip to make the trucks road-worthy. The semiconductor (chip) shortage was spurred by chip manufacturers overseas who pivoted toward consumer electronics during the worst of the pandemic as truck and auto sales swooned.
“We’ve done so much overseas that’s we’ve lost control of so much of our economy. No one cared when it was just the American worker getting screwed,” Congressman Tim Ryan (D-Youngstown) said during a stop on Thursday in Athens County when alerted to the news of the layoffs. “Now it’s the economy shutting down because we can’t get parts, but still, because there’s a supply chain issue, the workers are going to take it on the chin, again.”
Earlier this month, United States President Joe Biden answered a question from the Guardian regarding the chip shortage.
“I know they are [sitting in lots]. That’s why we are going to invest billions into bringing chip manufacturing to the United States,” the President said. “This is a gigantic, gigantic issue.”
The Guardian reached out to the White House on Thursday for comment about the layoffs.
PACCAR’s first quarter 2021 truck deliveries were estimated at approximately 42,000 vehicles, compared to 40,800 vehicles delivered in the fourth quarter of 2020. PACCAR said the trucks in Ross County, numbering in the hundreds, will sit parked until the parts become available.
“We’ve been able to build trucks all the way through the process and then stage them for those parts,” Kenworth General Manager Kevin Baney told FreightWaves earlier this summer.
The Guardian reached out to PACCAR for a statement about the layoffs but did not hear back.
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