Federal Cartridge has either laid off or given buyout packages to 12 percent of its workforce in Anoka, with more cuts in the last two weeks.
Last week, 21 salaried engineers, plant supervisors and other workers were laid off. This week, 21 hourly workers took buyouts.
The cuts were on top of 130 layoffs earlier in the month, bringing the total number of displaced workers to 172. The departures drop the Anoka plant’s employee count down to about 1,260 from 1,430.
The newest employee reductions are due to the “same drivers as before,” said Amanda Covington, spokeswoman for Federal Cartridge’s parent company, Utah’s Vista Outdoor. “It’s the changing market dynamics and changing demand” for ammunition that are forcing the staff reductions.
The company originally said 110 had been laid off in early March but revised that number to 130.
As the election approached, fears of possible new gun control laws in the United States resulted in increased firearms sales, including ammunition. As worries dissipated with the election of President Donald Trump, a known opponent of government regulations, gun and ammunition sales have fallen, industry watchers said.
It’s not known if the demand drag will last long. But the conundrum has captured headlines and chipped corporate results. Groups such as the National Shooting Sports Foundation and others are monitoring the situation as gun and ammunition sales at firms such as Winchester Ammunition, American Outdoor Brands, formerly Smith and Wesson, and Federal Cartridge have watched sales or stock prices fall since November.
Vista Outdoor’s fourth quarter ends Friday and the firm will report results in May.
Covington said she could not say if there will be more staff cuts. As of now, officials are looking to a new fiscal year and will soon forecast expectations, she said.
The Minnesota Department of Employment Economic Development (DEED) has offered company officials use of its dislocated worker services program, which assists laid-off workers with retraining, job counseling, résumé writing and other services, said agency spokesman Shane Delaney.
Federal Cartridge’s downsizing came as a surprise to state officials, who as recently as November had approved $1.15 million in state grants and loans toward a $33.9 million factory expansion and efficiency project in Anoka. The state aid came with the company’s promise of 50 new jobs.
Covington said the company has pulled its request for the aid because while the expansion remains on track, it is unlikely to deliver the 50 jobs at this time.