Printed on: October 05, 2012

Mine layoffs hit hard in Challis, Salmon

By Zach Kyle
zkyle@postregister.com

Custer County and nearby communities were left reeling after 104 workers were laid off from the Thompson Creek Mine.

Thompson Creek Metals, which owns the molybdenum mine, announced Wednesday it was suspending the stripping aspect of the operation.

Losing 100 jobs will ratchet Custer County's unemployment rate from 6.7 to 10.7 percent, said Will Jenson, regional labor economist for the Idaho Department of Labor.

That number doesn't take into account that many mine employees hail from Salmon, Mackay and the surrounding area, Jenson said. But the actual figure could be worse.

"A lot of businesses in the area survive off of wages that are earned and spent by Thompson Creek employees," Jenson said. "When there's a layoff of 100 people, it won't just be limited to those 100 people."

Chairman and CEO Kevin Loughery said the declining value of molybdenum and weakening demand for it domestically, as well as in China and Europe, prompted the cut.

Loughery said the company will save about $100 million by halting stripping.

The remaining workforce of about 300 will continue mining ore that already has been stripped until the end of 2014, he said. The company then will re-evaluate the operation. If the market doesn't rebound, the operation will close until the market improves, Loughery said.

"There's no question about that," Loughery said. "If between now and the end of 2014 there's no stripping, we won't (resume operations).

With the exception of Idaho National Laboratory, layoffs of more than 100 employees are rare in eastern Idaho, Jenson said.

More than 120 workers lost their jobs when the Idahoan Foods potato processing plant near Dubois closed in 2009. The last major mine layoff came in 1999 when as many as 200 workers lost jobs after the Bear Track Mine near Salmon closed, Jenson said.

Melissa Fitzgerald, executive director for the Challis Area Chamber of Commerce, said she wasn't ready to comment on the long-term consequences. But she said the news wasn't good.

"We recognize this is a big blow to the individuals in our community," Fitzgerald said. "Layoffs, of course, have a large impact on our local economy."

Jenson said luck and circumstance could work in the favor of newly unemployed mine workers.

Formation Capital is in the process of securing funding to open a cobalt mine in the Salmon area. The project website, Idahocobalt.com, says the mine would employ 157 workers in the Salmon-Challis area.

Jenson didn't know when the cobalt mine would open or whether the laid-off Thompson Creek workers could move to positions at the cobalt mine, which won't be an open-pit operation.

"If funding came through (to open the cobalt mine), it would be great to see some of these recently laid-off miners transition to the cobalt mine," he said.

Loughery said the laid-off workers were mostly truck drivers and mechanics who worked on the now-idled trucks.

Truck drivers are in demand, Jenson said, and many can probably find new jobs.

"There's an increase in demand for truck drivers nationwide and even in eastern Idaho," he said. "Trucking schools are operating at or near capacity. If you have a clean driving record and the commercial driver's license, you can find work pretty quickly."

Zach Kyle can be reached at 542-6746. Comment on this story on Post Talk at www .postregister.com/posttalk/.

Help is available for laid-off workers

Laid-off Thompson Creek Mine workers can gather information about unemployment insurance and other benefits during a meeting Tuesday with staff from the Idaho Department of Labor.

The meeting will be held from 9 a.m. to 4 p.m. at Challis Middle School.

Instructions and pamphlets will be available on additional government programs, such as the Workforce Investment Act, which provides retraining options for dislocated workers.

The Salmon Department of Labor Office holds regular workshops teaching job-seeking skills, such as resume writing and interview strategies, from 8:30 a.m. to noon the first and third Wednesdays of each month. Office manager Merri Logan said the workshops can be on additional days and at larger venues, if needed.

Logan is available at (208) 756-2234, ext. 3092.

For information on Department of Labor programs, go to labor.idaho.gov.