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Electrolux closing St. Cloud plant next year, taking about 900 jobs

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An Electrolux building in St. Cloud.
An Electrolux building in St. Cloud.
Ambar Espinoza | MPR News file

Updated: 3:40 p.m. | Posted: 12:30 p.m.

Appliance manufacturer Electrolux says it will close its production facility in St. Cloud in 2019, affecting about 900 jobs.

The Sweden-based manufacturer said Tuesday it plans to invest about $500 million in its U.S. operations, including plants in Springfield, Tennessee, and Anderson, South Carolina.

Electrolux's freezer production will be consolidated at its South Carolina facility, the company said. Production at the St. Cloud plant is expected to continue through 2019.

Company spokesperson Eloise Hale said about 900 employees in St. Cloud will be affected by the closure. She said all will be eligible for jobs at other facilities.

The closure will be a significant economic blow to St. Cloud. The appliance manufacturer has been a fixture in the community for decades with its sprawling plant on 33rd Street North, on the original site of the Pan Motor Company.

"It's been a place where manufacturing's been going probably for a century in one form or another," said Louis Johnston, economics professor at the College of St. Benedict/St. John's University.

Johnston said Electrolux's decision follows a broader trend of equipment manufacturers moving operations to lower cost areas of the United States or overseas.

The plant's closure could have a wider impact on St. Cloud beyond the lost jobs, Johnston said.

"Institutions build up around that — everything from gas stations and convenience stores to there used to be a tattoo place right across the street to grocery stores, and that is part of the community," he said. "And if that goes away, it's really going to affect what that side of St. Cloud looks like."

The plant has been a good source of relatively high-paying, stable jobs for St. Cloud's immigrant community, Johnston said. 

Teresa Bohnen, president of the St. Cloud Area Chamber of Commerce, called it "very disappointing" to see a company that has been such a tradition in the community leaving.

Bohnen said St. Cloud officials already have reached out to U.S. Sen. Tina Smith about the possibility of federal workforce grants and retraining funds.

"It's good that we have two years to go about this and that the layoffs will most probably be staged, so we have retraining time and can get people into jobs," Bohnen said. "The good news is we've got the jobs, so it's just getting them up to speed so they can do them."

Luke Greiner, regional labor market analyst with the Minnesota Department of Employment and Economic Development, said the closure will have a "pretty significant impact" on St. Cloud's manufacturing sector.

Greiner said the 900 jobs is about 17 percent of the city's 5,300 total manufacturing jobs.

"Almost one out of six would basically disappear if no other companies have a corresponding expansion," he said.

On the positive side, the strong economy means workers are in demand, Greiner said.

"We do have a huge amount of openings in our area, so there's ample opportunity for them to move into other types of positions," he said. "The sticky part is whether or not the skills they have match the skills needed for the openings we have at the remaining companies in town."