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NORWALK, Ohio - As elected officials swung into motion to try to save the temporarily closed Norwalk Furniture Corp. factory, employees and local officials yesterday blamed a faltering economy and foreign competitors.
The Huron County company that makes high-quality sofas and upholstered chairs, some of it custom-made, abruptly told its more than 500 workers Friday not to return to work until further notice as it attempts to solve an internal financing problem.
"We put out a quality product out there," said Steve Perry, 49, an upholsterer who has worked for the company 14 years, as he gassed up his car yesterday. "People don't have the money to spend."
He said foreign competition compounds the problem.
"Myself, I think they should just shut the borders off, not bring anything in," he said, terming the shutdown "sad."
He said pay ranges from $9 to $21 an hour at the factory.
Tractor-trailers yesterday sat idle at Norwalk Furniture, which borders a cornfield on the outskirts of Norwalk, about 70 miles southeast of Toledo. About 20 cars were in the parking lot. One worker said they belonged to customer service representatives.
A statement from the firm indicated Norwalk's shutdown will last until "internal issues regarding their current banking partnership can be resolved."
"We are committed to restarting operations as quickly as possible," said James Gerken, company chairman.
Officials from the city of Norwalk and the Norwalk Area Chamber of Commerce said they are in touch with state, federal, and local lawmakers about government assistance. But all were close-mouthed about the exact financial crisis that had caused the shutdown.
"We're looking at short-term solutions and long-term solutions," said Bethany Dentler, an official with the Norwalk Economic Development Corp. "We're involving private-sector partners. We're involving public-sector partners at all levels, from state to federal agencies and elected officials."
Ms. Dentler said that while there are conflicting views on international trade, Norwalk Furniture Corp. has definitely been hurt by cheap imports.
"It's not just free trade that has affected sales of furniture," she said. "Between that, whatever's going on with the housing market, credit tightening in the banking industry, all of that has created a scenario that has impacted manufacturing sales."
Shirley Pelham, who retired in 1996 after 43 years of working for Norwalk, said: "We make good furniture and it's expensive furniture and if people aren't working, they can't afford" to buy new furniture.
"I think people are having trouble buying anything with gas the way it is, food, just everything," Mrs. Pelham said. "I'm really worried - not for myself, for the whole area."
Scott Nutter, 50, of Norwalk, who works in the company's purchasing department, called the shutdown, "terrible. It's a shame for the community."
"We're hopeful they're going to work it out. It's an ongoing negotiation. You have to act realistically and try to stay optimistic," Mr. Nutter said.
He said sales have been declining for 10 years, but he didn't see the shutdown coming.
"The state of Ohio, and the county, and the city need to step up and provide some assistance," Mr. Nutter said. "Here's a business that has been in the community and wants to stay."
U.S. Rep. Bob Latta (R., Bowling Green), whose district includes Huron County, said he was working with business and state government officials, but said he was not at liberty to discuss the details.
"We're working with the folks in the [Ohio] Department of Development and we've also made contact with local economic development officials to find out what we can do to help in this situation," Mr. Latta said.
The Democratic candidate for Mr. Latta's seat, Norwalk disc jockey and karaoke operator George Mays, said he heard about the troubles weeks ago and was under the impression they had been overcome.
"Primarily it's the economy. It's down so low, and [with] the influx of cheap furniture from foreign countries, they can't compete," Mr. Mays said.
City Mayor Sue Lesch said many people in the community are "working feverishly" to get the plant reopened.
"I think they're looking at doing some different things," Ms. Lesch said. "It's our biggest manufacturer. They're the very best jobs in the city."
She estimated Norwalk Furniture's annual contribution to city tax revenues at $250,000, and said the company has a $20 million payroll.
She said foreign competition from the lifting of trade barriers such as passage of the North American Free Trade Agreement, in addition to competition from companies in China, has undercut manufacturing in Ohio.
"NAFTA's hurt them a great deal," Ms. Lesch said. "You have folks making furniture without the same restrictions and challenges we have here."
Unemployment in Huron County was 8.1 percent for June, up from 7.3 percent in May, according to the Ohio Department of Job and Family Services.
Mayor Lesch said Norwalk Furniture Corp. has a sincere commitment to Norwalk, having recently closed a plant in North Carolina and moving the work to Norwalk.
She said the United Steel Workers union, which represents workers at the plant, made concessions in April to bring the work to Norwalk.
One employee said the concession involved, among other things, deferring a 25-cents-per-hour wage increase.
The company also suspended operations at its plant in Cookeville, Tenn. It blamed its problems on the economy and changes in the furniture industry. Company sales dropped $8 million from 2006 to 2007.
The company was founded in 1902 and has been in Norwalk since 1919. Its products are sold under the trade names Norwalk, J. Raymond, Joe Ruggiero Collection, and Hickory Hill. The company has retail stores in the United States and Canada.
The trade magazine Furniture/Today reported June 26 that the company went through a restructuring with the help of Morris Anderson & Associates of Chicago. The magazine said several executives had left the company, but the company was still headed by longtime owners, the Gerken family.
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As elected officials swung into motion to try to save the temporarily closed Norwalk Furniture Corp. factory, employees and local officials yesterday blamed a faltering economy and foreign competitors. The Huron County company that makes high-quality sofas and upholstered chairs, some of it custom-made, abruptly told its more than 500 workers Friday not to return to work until further notice.