Gates Co. To Close Jefferson Facility By Early 2014, Layoffs of 247 Represent 2 Percent of Ashe’s Labor Force

Published Monday, July 29, 2013 at 3:43 pm

By Jesse Wood

July 29, 2013. “What do GE Aviation, American Emergency Vehicles (AEV), Leviton, and the Gates Corporation all have in common? They call Ashe County home.”

That’s the lead sentence on the homepage of Avery County Economic Development’s website, and come early 2014, that will no longer be the case.  

Last Friday, Tom Reeve, vice president for Gates Corporation, confirmed to various media outlets that Gates Corporation, which employees 247 people, will begin cutting back production in its Jefferson plant in September and will be closed by the first part of 2014. Reeve told the Jefferson Post that the 247 layoffs would be staggered and that severance packages would be based on tenure.

“It’s always a difficult decision to close a plant,” Reeve told the Jefferson Post. “Our industry is always competitive, and we’ve taken this decision to be competitive, and provide our customers with the best product and services.”

The plant in Jefferson made automotive hoses and belts. Headquartered in Denver, Colo., Gates employs over 14,000 people across 106 locations in 30 countries.

With 247 employees at the Jefferson plant, Gates Corporation was one of the largest employers in Ashe County. 

According to the most recent county unemployment rates released by the N.C. Department of Commerce’s Labor and Economic Analysis Division, Ashe County had an unemployment rate of 11 percent as of June, which was among the 20 highest of the 100 counties in the state. The 247 layoffs represent more than 2 percent of Ashe County’s labor force, according to state civilian labor force estimates.

With the recent passage of House Bill 4, which went into effect on July 1, the layoffs come at a particularly tough time for the employees because maximum weekly unemployment benefits have been lowered from $535 to $350 and maximum number of weeks an unemployed person can be on state unemployment benefits shrank from 26 to 20 weeks.

Ashe County Manager and Director of Economic Development Pat Mitchell wasn’t available for comment on Monday as she was on vacation, but she recently told the Winston-Salem Journal that closure of the Gates Corporation facility in Jefferson dims the early-July announcement that GE Aviation plans to expand its West Jefferson facility that machines rotating parts in jet engine and aircraft systems.

GE Aviation announced that the West Jefferson facility is poised for an 80,000-square-foot expansion that will come with an additional 105 jobs by 2017.

“There may be some overlap in the skills of the Gates and GE Aviation employees,” Mitchell said. “But we had hoped the GE Aviation jobs would be a net gain for the community, and not now as a way to put some of the Gates employees back to work.”

Mitchell added that Ashe County officials are “reaching out” to Gates Corporation to see if there is anything Ashe County can do to persuade Gates to reverse its decision.

“A community never wants to receive this kind of news for their citizens,” Mitchell said. “Gates has been an important part of our industrial economy for many years.” 

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