Fergus plant closing shows Ontario’s decline

“You don’t want to be doing nothing when you’re laid off, you need something on your resume,” says Nathanael Martin. He’s general manager of the Bibles for Missions Thrift Store in this pretty Grand River town of 10,000 a short drive north of Guelph.

“Our sales have actually increased since A.O. Smith closed down. I’ve seen a significant jump.”

The shuttering of the plant, its jobs moved to the United States save for several dozen sales and warehouse positions in a remaining distribution centre, is a textbook case in the decline of Ontario’s traditional manufacturing sector.

At Queen’s Park, the Progressive Conservatives and New Democrats frequently remind Premier Kathleen Wynne the province has lost 300,000 manufacturing jobs in the last decade.

The latest casualty came 10 days ago when Heinz announced its 104-year-old plant in Leamington will close next year, idling 740 workers. This dreadful news is in addition to hundreds of jobs lost at Caterpillar’s Electro-Motive Diesel plant in London, Bick’s Pickles in Dunnville, U.S. Steel in Hamilton, Hershey’s chocolate in Smith’s Falls . . .

“Some of the people that were working here, this is their third plant that has closed,” says A.O. Smith veteran Cal MacDonald, a member of the United Steelworkers union.

He runs a strip centre action centre to help former colleagues find jobs or retraining through government programs. One of 16 similar centres across the province, it gets $153,000 from the Ministry of Training Colleges and Universities.

“There’s lots of new places opening up . . . but these people are going to be losing about $4 an hour,” MacDonald adds in his office, scrolling down a computer screen.

“We see lots of jobs that are $11 an hour. People aren’t willing to take those.”

MacDonald is talking about welders and assemblers, material handlers and shippers. Many are trying to steer clear of manufacturing altogether in hopes of finding lasting employment after their time with Milwaukee-based A.O. Smith. The company still has 10,900 staff at operations in North America, India, China and the Netherlands.

“It was a good place to work, but no more factories for me. I don’t want to be doing this every five years,” says Steve Pick, a father of two schoolchildren who works with MacDonald at the centre.

“There doesn’t seem to be a future in this,” Pick adds without a trace of bitterness. This is his second factory closing.

A.O. Smith blamed the Fergus closure on an “extremely competitive” North American water heater market, manufacturing overcapacity and “a challenging economic environment as a Canadian manufacturer.”

Wynne, who will fight the next provincial election on jobs and the economy, speaks often of the need to train workers for “advanced manufacturing” industries the province wants to lure. They often use fewer people and more technology.

“We’ve got to have the right programs in our colleges . . . we’ve got to provide the opportunities for young people to get the skills they’re going to need,” she says.

“The manufacturing that we are doing in the province now and that will come to us is not the same manufacturing that you know, when young people graduated from high school or left high school in the 1970s,” she adds.

“There was a whole range of jobs that didn’t require them to have a high school diploma. That’s not the kind of manufacturing we have in place now.”

Indeed, laid-off workers need computerized machinery training but some don’t have high school diplomas. They start at the bottom of the ladder if they get jobs at other area plants, laments one Fergus-area employment counselor.

That’s why Marc Nantel of Niagara College recommends that old-style factory workers get their diplomas and seek formal training in mechanical engineering technology, machining or 3D computer-aided design.

Financial and psychological blow

“Try to find time at night, which is tough for some people, but one would want to go to the local community college to see what programs they have,” says Nantel, associate vice-president of research at Niagara, which has an advanced manufacturing program.

“That’s the one thing that would probably help in the long run. You never know what’s going to happen.”

To understand the financial and psychological blow to Fergus of the closing of its largest employer, it’s important to know the history.

Almost 100 years ago, the factory was opened by the local Beatty Brothers> it made farm implements before morphing into water pumps, washing machines and then water heaters. Generations of Fergus residents worked there, from fathers to their sons and grandsons. A.O. Smith, a massive global corporation, bought it in 2006 from another company.

The community-minded Beatty family built houses for their workers, many still standing — historic plaques on each — down the leafy streets.

Now the plant’s parking lot, which used to be packed with hundreds of cars for day and evening shifts, holds barely 70 on a weekday. There’s so little traffic that piles of leaves lie undisturbed in the middle of the road.

A few minute’s drive south and down a hill into downtown, in an old riverfront mall made of stone, staff at the Centre Wellington Food Bank are bracing for impact from the A.O. Smith closure. Their hunger business has already doubled since the 2008 recession.

For the moment, many A.O. Smith workers are still relying on severance pay of one week per year of service, but food bank chairwoman Jackie Andrew is expecting to see some sooner or later.

And missing, at least in its previous incarnation, will be donations raised by A.O. Smith in conjunction with the Steelworkers, which represented workers at the plant.

“They were always a large donor to our food hampers, they were amazing,” says Andrew, speaking a short walk down the mall from a grocery boutique and its tempting butcher shop.

“For us it’s a double impact. We’ll be seeing their former employees and we’ll be losing all that support.”

Back at the action centre, across from a Tim Horton’s under renovation and beside a new Target store with more employees than shoppers on a sunny fall afternoon, MacDonald waits for former colleagues to stop in.

There are telephones, a boardroom, a tiny kitchen, a shelf of self-help job and resume books, and five computer workstations.

One-third of the laid-off A.O. Smith workers have registered for assistance and MacDonald is working to get more signed on. Of those registered, 58 per cent have either found new full or part-time jobs, gone into retraining or retired.

“It’s nice when four or five people are in here,” MacDonald remarks on a slow day where not a single worker showed up. “They start talking, like “did you hear so-and-so got a job?’ ”

Local MPP Ted Arnott, a Conservative whose party is proposing to make Ontario a “right-to-work” province without mandatory dues deduction for unionized workers, has complained Wynne’s minority Liberal government took too long after the closure in July to set up the centre. It didn’t officially open until early September.

“Why did it take five months?”

Training, Colleges and Universities Minister Brad Duguid says the government moved as fast as it could with local authorities, which sent representatives into the plant right after the closing was announced in April and held regular workshops to fill the gap.

Steelworkers local 3789 is back in negotiations at A.O. Smith on a new contract for the 47 unionized workers that remain.