JK Products and Services Inc. is closing its tanning bed manufacturing facility in Jonesboro and laying off 82 employees, the company announced this week.
Employees were told Monday that the plant would be closing, because JK Products and Services is moving its manufacturing operations to its headquarters in Germany, said Jerry Deveney, executive director of sales for the company.
He said he told employees they have 60 days until their jobs end.
JK Products and Services Inc. is a division of JK-Holding GmbH, a Germany-based indoor tanning equipment manufacturer.
He said about 41 employees in the company’s sales and services division will not lose their jobs. The company employs 123.
“Sales are still strong in the United States, but the global volume doesn’t warrant two production facilities,” he said, referring to the consolidation of the company’s manufacturing operations.
Deveney said the laidoff employees will receive severance packages. He said the company also is trying to find new positions for nonmanufacturing employees who will be laid off.
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“We are actually trying, and have been successful, in finding positions with our distributors,” he said.
The company has several independent distributors in the United States, including in Dallas, Cleveland and Paris, Tenn.
The layoffs will have animpact on the community, said Mark Young, president and chief executive officer of the Jonesboro Regional Chamber of Commerce.
He said the manufacturing plant has been in the area since 1979.
The 135,000-square-foot facility was originally owned by Sun Industries. It was acquired by JK-Holding in 1999.
As of May, goods-producing employment, which includes manufacturing, makes up 17.6 percent of Jonesboro’s economy, said Kathy Deck, director of the Center for Business and Economic Research at the University of Arkansas at Fayetteville.
The rest of the city’s economy, 82.4 percent, is made up of service-producing jobs, such as doctors and lawyers, she said, adding that the plant’s layoffs will make up a small portion of the state’sunemployment rate.
“That said, nobody likes to see anybody laid off,” Deck said.
Jonesboro’s unemployment rate was 6.5 percent in April, she said.
“We will work with the company and with other state officials to make sure the support and resources that are needed are there to assist the employees in finding other opportunities,” Young said.
Business, Pages 27 on 06/22/2013