As Esskay started laying off the first of roughly 500 workers at its East Baltimore plant yesterday, union and government officials scoured the city for an empty factory where the workers could resume preparing hams and sausages.
"We will do all we can to keep the operation in Baltimore," Mayor Kurt L. Schmoke said after meeting with company officials yesterday.
Esskay, a division of Virginia-based Smithfield Foods Inc., announced Wednesday that it had discovered that the walls and floors of the plant on East Baltimore Street weren't strong enough to safely support the ham-boiling machines inside the 72-year-old factory. The huge machines cook 20,000 pounds of hams in a single batch, workers said.
Ironically, the company said the discovery was made by engineers deciding where to add new machines and workers. Esskay hired 39 new workers last month and was planning to add third, midnight shifts in some areas, workers said.
But instead of hiring, the company, fearful of an accident, laid off all 55 workers in the ham-boiling department yesterday. It then announced that it would lay off approximately 450 other plant workers by the end of the year.
The workers said they were heartbroken to learn of the closure but were divided over whether the company was truly closing for safety reasons.
Gary Matthews, 30, said he had long thought the factory was unsafe. "That building is falling down. . . . You could see the cracks," he said.
But sausage maker Carl Miller, 27, wasn't so sure. "I sort of felt it coming," he said of the closure.
The workers agreed that the closure would be devastating for them and the East Baltimore community.
Tom Moore, 41, had recently been promoted to assistant supervisor of the boneless ham slicing department and was helping prepare for the addition of the third shift of workers.
But last night as he watched television reports of the company's announcement and told his family that his job would end Dec. 31, one of his daughters commented on the timing: "Right around Christmas."
He and the other Esskay workers are "sad and frustrated. . . . Being unemployed is devastating." The closure comes at the same time that Smithfield is expanding elsewhere.
The company has been growing in recent months despite weak prices for pork, said George Shipp, who follows the company for the brokerage firm of Scott & Stringfellow in Richmond, Va.
Yesterday, Smithfield opened a new hog-killing plant in North Carolina. And the company has expanded processing plants in Virginia and in Landover in the past year, he said.
Mr. Shipp expects the company to keep growing and will have to replace the Baltimore capacity within a few years.
Despite the expansion, Smithfield's earnings have been hurt by a glut of pork products that have driven down prices. The company, which said that its Esskay unit was "marginally profitable," earned $1.5 million in the three months ended Aug. 2, down from $3.2 million in the same period a year ago.
Mr. Schmoke, Maryland Secretary of Economic and Employment Development Mark L. Wasserman and representatives from the state's congressional delegation met with the plant managers yesterday to offer their help in keeping the work in Baltimore.
Mr. Schmoke said he hoped the city could help build an industrial park on the site of the building.
"If Esskay shuts down and we have no hope of getting anyone else in here, it will have a tremendous impact on East Baltimore," he said.
Mr. Schmoke and Thomas Russow, president of the Food and Commercial Workers union local that represents 400 workers at the plant, said they had already found one empty factory that could take the Esskay operation and added that they would look for more alternatives.
Mr. Wasserman said government agencies would band together offer incentives such as tax breaks, training, loans or zoning assistance to keep the operation in the city.
Company officials declined to comment on the city's attempt to keep the operations here.
Smithfield Chairman Joseph W. Luter III said Wednesday that the work performed here would be moved to other facilities. The sales and marketing operations will stay in Baltimore, he said.
As a first step, the city and state brought aides to the factory to help the newly laid-off workers apply for unemployment and other benefits.
The Esskay workers, who receive $8.72 to $11.22 an hour, do not expect to receive severance pay from the company, union officials said.
Smithfield has offered the workers jobs at other plants, including the recently expanded Mash's factory in Landover, Mr. Russow said. But getting the workers to the jobs could be difficult because many of them don't have cars, he said.
Mr. Russow said he was disappointed by the announcement, especially since the union and city fought hard to keep the factory here in the early 1980s. But he agreed that the factory had to be closed for safety.
"Safety is No. 1," he said.
He said the company and workers knew the building was antiquated and would probably last only a few more years. But everyone hoped it would last long enough to allow for a smooth transition to a new Baltimore factory.
Smithfield had spent some money "patching" up the old building, bought for $1.9 million in 1986, but said it wasn't worth investing in a complete rehab, Mr. Russow said.
The company told him it would cost about $2 million per floor in the six-story building to bring the building up to modern standards.