Siemens Corporation has announced a major layoff at their facility in Fort Madison.
A wind energy equipment manufacturer says it will lay off 615 workers in Iowa, Kansas and Florida in part because Congress has not renewed a tax credit for wind energy.
Steve Bisenius, executive director of the Lee County Economic Development Group said that it's a sad day for both the county and the region.
"It is stunning, unbelievable," he said. "We look at the wind industry and see that there is a slowdown in the industry. No question, one cannot be totally surprised." Steve Bisenius, executive director of the Lee County Economic Development Group, said.
Siemens Energy Inc. says it told workers the news Tuesday at plants in Fort Madison, Iowa; Hutchinson, Kan., and Orlando, Fla.
The biggest cuts will come in Fort Madison, where 407 workers at a wind turbine blade factory will be out of work. About 220 workers there will be retained.
The company blamed difficult market conditions due to lack of congressional action on a wind energy tax credit as well as increased use of natural gas-fired power plants and an overall sluggish economy.
In a statement, Siemens says the industry is seeing a significant drop in new wind turbine orders.
Employees learned about the layoffs Tuesday. The layoffs will go into affect Nov. 19. Employees will receive severance pay based on their years of service, including a minimum four-weeks pay for employees with six months or more of service. Company spokeswoman Melanie Forbrick said Siemens will provide career counseling and $5,000 of education and retraining benefits.
The company received $3.4 million in tax incentives under the U.S. Department of Energy's manufacturing tax credit program for the Fort Madison facility expansion, according to the company's Web site. In total, the company currently employs 600 people in Fort Madison with more than 150 indirect jobs created by its presence in the city.
Bisenius said that his organization will contact the offices of U.S. Sens. Chuck Grassley and Tom Harkin to see what effort can be taken to get the tax credit extended.
Harkin, who visited the plant in August, released a statement Tuesday.
"I'm surprised and disappointed by today's announcement about the impact on the affected workers and their families," the Cumming, Iowa Democrat said. "Today, my thoughts are with each of them."
Iowa Republican Sen. Grassley's office also released a statement blaming policies and regulation for the plant's layoffs.
â??My heart goes out to the people losing jobs. When you're in that situation, itâ??s a depression, not a recession, for you and your family," he said. "In this case and others, the market conditions described by the company emphasize the need for certainty of policies out of Washington, from the production tax credit for wind to the threat of other taxes going up and heavy-handed regulations that make it harder for businesses to sustain and create jobs."
The Associated Press contributed to this report.