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Company officials blame a nationwide building industry slowdown causing a ripple effect that has impacted the cabinet company.
Kathleen Vokes, spokeswoman for Detroit-based Masco Corp., KraftMaid's parent company, said employees at three KraftMaid locations, including Middlefield, Orwell, and Sayre, Pa., were told Thursday they would be laid off indefinitely.
"Housing starts were down 12 percent across the board in 2006, especially in the last half of the year," Vokes said. "That caused a building and remodeling industry slowdown."
Vokes said she could not confirm how many employees were affected by the layoffs, but Middlefield Village Administrator Dan Weir estimated that about 500 employees at the three locations were given the layoff notices.
KraftMaid is Geauga County's largest manufacturing employer, according to County Economic Development Director Anita Stocker. She estimated that the company has more than 2,000 employees in Middlefield, and about 1,000 at the Orwell plant.
Weir said the 2005-06 housing boom prompted the company to increase its total payroll to about 4,700 last year, and he believes fluctuations in the housing
industry contributed to Thursday's layoffs.
Stocker said recent administrative shake-ups at the Home Depot may also have contributed to the KraftMaid situation, since the Middlefield-based company supplies cabinets to the home improvement retail giant.
The layoffs are likely to impact other area businesses as well, Stocker said.
"This could hurt everything from doughnuts to shoes," she said.
County Commissioner Mary Samide called the layoffs a "shame."
"That is really going to hurt a lot of people," Samide said Friday.
"For some people, that's all they have. This is not good for Geauga County either."
Samide said she believed last year's nationwide "housing bubble" was a temporary, artificial inflation of prices that was bound to burst eventually.
"People made their money up front, but somebody had to pay the price eventually," Samide said. "It's just a shame it had to be here."
Vokes hopes the demand for new housing and remodeling will pick up again.
"Any time this happens, it's unfortunate for those who are affected," Vokes said. "We hope to offer re-employment opportunities to at least some of the hourly employees who were laid off."
"If sales increase, they can be called back," she said. "We're very hopeful about that."
