Citing a "persistent housing market recession" and a flat outlook for 2012, window and door manufacturer Andersen Corp. plans to lay off 250 workers, most of them at the company's home base in Bayport.
The company has been cutting its workforce since the housing market peaked in 2006. Its last major cutbacks were in 2009, when it laid off about 250 nonmanufacturing employees and closed a Massachusetts plant with 287 workers.
The latest job cuts, which will occur by the end of the year, represent less than 3 percent of its 9,000 employees nationwide. About 3,200 of those workers are in Minnesota, in Bayport and at corporate offices in Oak Park Heights and plants in Cottage Grove and North Branch.
Andersen spokeswoman Laurie Bauer said Wednesday the company has taken other steps to cut costs, like reducing workers' hours. "The majority of the people being laid off now are full-time people who have not been working full time," she said.
Andersen's difficulties mirror those for the entire industry, which continues to struggle with depressed building activity and lower consumer confidence. Iowa-based Pella Corp. recently announced it would close a Columbia, S.C., plant with 145 workers this year and shut a plant with 158 workers near Cincinnati in 2012.
Window shipments have fallen sharply since 2005 and are expected to fall about 9 percent this year, according to the Window and Door Manufacturers Association. Lower sales for new construction and remodeling are causing the declines.
Michael O'Brien, president of the group, said the 2009 federal energy-efficiency tax credit provided some support for the industry. But the reduced tax credit this year has done little to help the market, he said. The group has forecast a modest improvement in new and replacement window sales next year.
Herb Tousley, director of real estate programs at the University of St. Thomas, said he also believes the market for replacement windows may have simply peaked.
"Replacement windows are a high-ticket item. A lot of people may also find that its harder to get a home equity credit line because they've lost equity due to lower home values," he said.
Tousley also said a general feeling of unease about the economy is hurting consumer confidence: "Do you really want take on a large expenditure if you're not sure where the economy is headed and whether you'll have a job?"
Minnesota's other large window manufacturer, Marvin Cos., has seen its workforce drop slightly this year due to attrition, said President Susan Marvin. The company finished 2010 with about 5,000 employees in 10 U.S. plants, with about half the workforce at its Warroad headquarters.
Marvin said the company trimmed workers' hours during the worst of the recession and has increased them slightly this year. She said the addition of new products, like fiberglass siding, has helped production activity.
But there are few signs of a real rebound. "We don't see a single metric that shows a recovery is in sight," she said. Windows for new home construction won't bounce back until the housing industry works off the bloated inventory of homes in foreclosure, while the replacement window market won't improve until consumer confidence and the job market revive, she said.
Staff writer Thomas Lee contributed to this report. Susan Feyder 612-673-1723
