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Team Industries layoffs include 79 employees in Park Rapids

A series of cuts at Team Industries, and a planned month-long shutdown will hit the local economy hard, said Mayor Nancy Carroll. (Sarah Smith / Enterprise)

For 79 more Team Industries employees, Friday will be their last day of work.

The newest round of layoffs comes amid an industry downturn that will leave the Park Rapids manufacturer with around 40 employees, about the size of the initial plant the company opened 14 years ago. At its zenith, Team Industries, Inc., had a workforce of 180 employees at the Park Rapids plant.

The local plant will close for the month of May. The remaining employees will take percentage pay reductions when they return. The laid off workers will receive a week's severance pay and company payments toward their insurance plans for the next six months. That's the same severance package offered to 20 employees laid off in January.

The layoffs come as no surprise. The company said in January that substantial workforce cuts would be forthcoming. At the time, Team spokesman Jim Russ estimated 30 more employees would lose their jobs.

To a large extent, Team's fortunes are tied to those of its largest customer, Polaris Industries. One week before the Team Industries layoffs in January, Polaris gave 100 of its Roseau employees pink slips, citing a downturn in the sales of snowmobiles, ATVs and other recreational vehicles it manufacturers.

Polaris cited the recession and the decline of consumer discretionary spending. At the same time Polaris announced it was eliminating 160 full-time jobs and about 300 contractors in several plants due to weakening demand.

Last month Polaris' chief executive, Scott Wine, told the Wall Street Journal he believes Polaris's 2009 sales could decline by 23 percent, the worst downfall in 25 years. He said it was highly likely that 5 percent of Polaris's dealers could liquidate this year.

The same day, Polaris formed an alliance with Bobcat, a North Dakota company that makes skid steer loaders, in hopes of bolstering both companies' bottom lines. But that alliance apparently won't affect Park Rapids.

One local employee said much of the Park Rapids manufacturing equipment has been moved to other company locations in the state, including Detroit Lakes, Audubon, Bagley, Baxter and Cambridge.

Team Industries manufactures transmissions, clutches and hydraulic parts for ATVs, motorcycles and snowmobiles.

A state agency that retrains displaced workers has been involved in the layoffs, said Minnesota CEP team leader Wanda Melgaard of Bemidji.

Russ, the company's Director of Corporate Development was on vacation Monday and unavailable to comment, a receptionist said. He did not return calls by press time Tuesday.

"I'm not sure how large of a geographic area they were drawing from but it's still a substantial loss for our community," said Park Rapids Mayor Nancy Carroll.

The highly skilled machinists may have trouble finding other work in the region.

"We're such a small community and we have so little industry here it's not like you can go from one company to another," Carroll said. "Well there isn't another one.

"I imagine the frustration and desperation levels would be high," she said. "They were very good jobs, very good paying jobs, good benefits. It's just the worst thing that can happen to highly trained people."