Coaxial cable maker CommScope said it will lay off 230 workers at its Catawba and Statesville plants over the next few months because of declining consumer demand.
The job losses reflect a contraction in consumer spending, CommScope officials and industry analysts said.
Company leaders met Tuesday and Wednesday with employees to inform them of the layoffs, said Rick Aspan, director of corporate communications. Most of the cuts – 210 – came at the Catawba plant, which has been in operation since the mid-1960s. Both plants are part of CommScope's broadband division.
“Essentially, the global economic recession has affected customer demand,” Aspan said, “and we're taking steps as aggressively as we need to manage costs.”
Demand for cable has slowed dramatically over the past two quarters, said Kenneth Muth, a senior research analyst with Robert W. Baird & Co. who covers the data networking and telecommunications equipment industries. He said the outlook for that sector should remain “very challenging,” at least through the first quarter of the year.
Many of the companies Muth tracks, including Alcatel-Lucent, are laying off people worldwide as they cut spending to preserve the cash they have, he said. Nortel Networks Corp., for instance, filed for bankruptcy in late 2008.
“Customers are disconnecting from cable television or Internet usage or dropping a phone line. Telecommunications is still the backbone of an industry – computers, telephones, you can't shut them down – but you can slow spending habits.”
CommScope's cuts “were across the board,” Aspan said, including production and support employees.
Some of the layoffs took effect immediately, while the rest will happen gradually through the first half of the year. Aspan said the company will give affected workers severance pay, medical benefits and help finding other jobs.
Before the cuts, the Catawba plant had 830 employees, Statesville 150.
The company, headquartered in Hickory, has five N.C. plants with 2,100 workers after this week's cuts. It employs about 15,000 people worldwide.
The layoffs hit a region already battered by the weak economy. Catawba County, where four of CommScope's plants are located, had a 10.7 percent unemployment rate in December.