Vallourec Star, an Ohio manufacturer that is closely bound to the oil and gas industry, announced it will be shutting down operations for three weeks and offering a six month voluntary layoff to its workers.
In mid-February, Vallourec’s Youngstown plant will be discontinuing operations, which will affect 700 employees. Vallourec has already adjusted production schedules, lowered prices with suppliers and used fewer contractors to deal with the downturn in the oil and gas exploration industry. The company said in a statement it is at a point where some employees will be affected by the temporary closing, and unfortunately it cannot be prevented.
Employees at the Youngstown plant will be able to file for unemployment benefits and use their paid time off to earn a paycheck during the closing. Workers will continue to have health care coverage, and if they accept the six month layoff coverage will continue uninterrupted.
The Youngstown plant opened in late 2012 and cost $1 billion to construct. When it opened, the plant employed 350 workers, which was a gift to the city of Youngstown after it had lost several manufacturing jobs.
Formerly known as V&M Star, Vallourec Star manufactures piping used in the oil and gas industry located in Ohio, Pennsylvania and West Virginia. As a whole, the shale industry in the U.S. is on a downward slide driven by dropping oil and natural gas prices. Energy exploration and production company vendors and suppliers are now reaping the effects of the downturn.