Georgia-Pacific Corp. said Wednesday that it will invest $70 million in its plywood and lumber operations in Gurdon and donate $100,000 to area schools.
No jobs will be created with the expansion of the plant that has about 700 employees.
"With a lot of capital improvements like this, they don't always have jobs attached to them but, at the same time, we feel they enhance the jobs that are there," Rick Kimble, a spokesman for Georgia-Pacific at its headquarters in Atlanta, said Wednesday. "We believe in the facility, and we're thankful for the support of our workers and the communities around us."
Georgia-Pacific bought the plant in 2006 from International Paper Co., which built it in 1979. That $237 million deal also included two other plywood and lumber complexes in Camden, Texas, and Springhill, La.; a plywood mill in Corrigan, Texas; and an engineered wood products mill in Thorsby, Ala.
Of the 2,400 workers at the five plants at the time, 650 were at the Gurdon plant, Georgia-Pacific said. Gurdon, in Clark County, has about 2,100 residents.
The $70 million investment announced Wednesday includes installation of an advanced merchandiser that determines best end-product use, new panel assembly stations, an upgraded power plant, and software and security enhancements. Work will be completed in 2020.
In 2016, the company completed a $40 million upgrade at the Gurdon mill, increasing production capacity by 60%, Georgia-Pacific said at the time.
Including the $70 million investment, Georgia-Pacific has spent more than $645 million in the past five years on its operations across Arkansas, the company said. Georgia-Pacific has 2,310 employees in Arkansas, with annual wages and benefits totaling $180 million, in Gurdon, Fordyce, Crossett and Fort Smith.
In June, Georgia-Pacific announced that 655 workers in Crossett and Hope would lose their jobs in the next few months.
The closing of the company's bleached-board operations at the Crossett mill in October affected 555 jobs, including 25 in sales and other business operations. Bleached board is used in paper plates, cups and cartons. About 500 other workers would retain their jobs, the company said.
In Hope, where Georgia-Pacific operates a particle board facility, 100 workers would lose their jobs "over the next couple of months" when that plant is closed, the company said at the time. Particle board is made from wood waste and used in construction and furniture.
The closing of a similar plant in Monroeville, Ala., also with 100 workers, was announced Tuesday by Georgia-Pacific.
"We're a market-based company," Kimble said. "Everything we do is totally dependent on the markets we participate in."
The closings in Crossett were based on a poor market for the plant's paper products, while the closing of the Hope plant was based on the market for particle board, Kimble said. "The particle board industry just hasn't been what it used to be. There's more product coming in from other producers, so it's getting harder and harder to compete in that work."
The market for the Gurdon products, however, remains strong, Kimble said.
"These investments [in Gurdon] are for the long-term," he said. "Even though the market swings back and forth on pretty much everything we do, we're very confident in Gurdon."
A news release from Georgia-Pacific said the investment of $70 million will have an estimated impact of more than $169 million, part of a ripple economic effect in southern Arkansas, said Gauri Guha, associate professor of economics at Arkansas State University in Jonesboro.
"Any large investment in an economic sector is amplified by regional economic multipliers," Guha said. "This means a direct investment of $70 million ends up generating an economic value of $169 million within the year."
Georgia-Pacific's donation of $100,000 over the next five years to schools in Gurdon and Clark County is part of the company's effort to be a part of the community, Kimble said. The money will go toward installing a multiuse playing field that will be used by the schools and for community events.
The schools aren't necessarily a pipeline for employment at Georgia-Pacific, "but if [the donation] gets the attention of graduating seniors who are looking for work, we're certainly happy with that," Kimble said.
A Section on 09/12/2019