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Archive for March 3rd, 2007

Impending closure of the Hershey’s plant in Smiths Falls

March 03, 2007 @ 10:50 By: gordon Category: Current affairs

This image from the CBC says it all.  Note the flag at half-mast.If you’re from eastern Ontario, chances are fair that you’ve heard that the Hershey’s plant in Smiths Falls is going to be closed by the parent company, which is based in Hershey, Pennsylvania. Besides making chocolates and candies in Smiths Falls, the Hershey’s plant is the second largest employer in town, employing 500 people. Not only will the closure of the plant result in the loss of these jobs, there will be secondary loses felt by the local companies that supply ingredients, packaging and transportation services to the plant. And then there’s the tourism benefit to the town. Over the years, I have visited the factory on a number of occasions to buy things from the factory store. Usually, I’ll stop in town to buy gas or something to eat, too. With the closure of the factory, trips like mine will be lost so the tourism revenues will be decreased.

As happens often in towns with large employers there are some families that derive 100% of their income from the factory. In Smiths Falls, 54 couples will find themselves without a source of income as a result of the plant closure. Thus, another result of the closure will probably be an increase in the use of welfare services. Some people might even have to leave town altogether to find work elsewhere.

The closure will be particularly hard on Smiths Falls because it’s going to be followed up by the largest employer in Smiths Falls, Rideau Regional Centre, who employees 800 people, closing its doors sometime in 2008. And, of course, there are some families of Hershey workers who have family members that work for Rideau Regional, so the town is going to be devasted over the next few years.

Dairy Farmers of Ontario, the marketing group representing Ontario dairy farmers, reported recently that they supply 39 million litres of milk (1.5% of the 2.6 billion litres produced in Ontario every year) to the factory in Smiths Falls. The factory pays a highly discounted rate of 30 cents/litre and apparently have never raised cost as an issue with the DFO. If they move some of the operations to Mexico, as some people think will happen, it’s unlikely that they’ll get a better milk price. Because DFO pools all the milk produced by its members, the losses will be distributed evenly to all the milk producers so no local farmers will suddenly find themselves with milk they can’t sell.

The Premier of Ontario has apparently spoken to the CEO of Hershey’s to see if there’s anything the province can do to convince the company to leave the plant open. From what was reported on CBC radio, the discussion doesn’t appear to have made a difference.

It’s puzzling that the factory will close given that it does turn a profit. According to CBC, the closure is part of a global restructuring program that will see the loss of 1500 jobs worldwide.

An online petition has been set up to try to convince the company to change its mind. It can be found at http://www.petitiononline.com/hershsf/petition.html. I encourage you to sign it, if for no other reason than the one a co-worker who lives in Smiths Falls put forward: “who doesn’t like cheap chocolate?”