OLEAN, N.Y. — Dresser-Rand in Olean will shut down for a week due to lack of work, and around 60 Siemens employees will be out of work by September in Wellsville due to “across the board” cuts at the factory, union officials said.
Company officials stressed the changes in the energy market as a cause for the shutdown and layoffs.
“Employees at all three sites — Wellsville, Painted Post and Olean — are aware of current changes in the global energy marketplace,” a Siemens spokesman said in a prepared statement. “Employees have known about challenging marketplace conditions for some time, and they have worked diligently and with the utmost professionalism toward making the plant competitive.”
“To align our workforce with our anticipated workload, the Wellsville Operation will need to implement a workforce reduction of approximately 60 employees between now and Sept. 30,” officials said. “This workforce adjustment will impact both production shop floor workers and office positions over the next few months. Reductions over this period will be based on current market demand as well as business volume at the plant.
“The reductions will start in the coming week. We will act as a resource for impacted employees during this time of transition, and also make them aware of open positions within Siemens Government Technologies and other Siemens organizations.”
John Baglione, president of United Steelworkers Local 4601, which represents about 480 members at the Olean plant, said the plant will be closed from July 4 to 10, with only some maintenance staff on hand.
“All of Olean’s marbles are in the oil industry,” he said. “When the oil industry is booming, Olean is booming.”
But with oil trading at $47 a barrel — down from a peak of $147 in 2008 — fewer orders for new equipment are coming in, said Ron Warner, the representative for International Association of Machinists and Aerospace Workers Local 1580 in Wellsville.
“I think people pretty much expected it,” Warner said. “It’s great for all of us at the pumps, but at all the plants in the Southern Tier … it’s starting to affect us.”
In Olean, the weeklong shutdown is the third since 2010.
“The union was given the choice between vacation and unemployment,” Bagliore said, adding that as far as long-term layoffs at the plant, he’s heard “nothing more than rumblings.”
The savings from shuttering the plant, he noted, are “an attempt to stop massive layoffs down the road.”
The IAW represents almost 300 of the 525 employees at the Wellsville plant, Warner said, adding the cuts will affect about 35 bargaining unit employees in the next two weeks, as well as some administration, engineering and management positions.
According to a briefing on Siemens’ website, the firm employs approximately 50,000 in the U.S. with 75 manufacturing facilities and other centers. The firm reported $22.4 billion in revenue during the 2015 fiscal year, including $5.5 billion in exports.
The Power and Gas Division in the U.S., headquartered in Texas, is made up primarily of the former Dresser-Rand and Rolls-Royce Energy firms, acquired in 2015 and 2014, respectively. The German conglomerate purchased Dresser-Rand at a deal valued at $7.8 billion.
Before the sale, Dresser-Rand was reportedly one of the largest employers in the region. Around 1,000 workers are employed in Olean, around 460 after the latest layoffs in Wellsville, and around 550 in Painted Post. That’s down from around 2,200 at the time the sale was announced.
Several layoffs have been announced since Siemens announced it intended to buy Dresser-Rand in 2014. In May 2015, Dresser-Rand announced it would lay off 650 workers nationwide — 8 percent of its workforce. Of those, 109 who were notified have been from the Olean plant, Baglione said, with about 80 out of a job now.
The business now owned by Siemens has a long history in the Southern Tier.
Clark Bros., founded in 1880 in Belmont to build pumps for the explosion in Southern Tier oil development, moved to Olean in 1912. The firm merged with Solomon R. Dresser Co. — originally of Bradford, Pa. — in 1938 to form Dresser-Clark, later Dresser Industries. Dresser-Rand was formed in 1986 in a joint venture of Dresser Industries and Ingersoll Rand, which owned a compressor manufacturing plant in Painted Post. The firm was purchased by Siemens in 2015.
