Analysis indicates Warren plant closure could cost millions to state in revenues, GPD
Statewide, flooring and millwork employs 903 people and pays an average annual compensation of $56,582.
By the U of Arkansas System Division of Agriculture
Aug. 2, 2024
Fast Facts:
- AHF closure results in an estimated loss of $16 million in labor income
- Estimates show Arkansas’ GDP will decline by $36 million
(336 words)
(Newsrooms: With art)
MONTICELLO, Ark. — The idling of AHF Products’ Warren flooring facility will mean the loss of 130 jobs with a ripple effect of millions in lost revenue and gross domestic product to Arkansas, according to an analysis released this week.
The Mountville, Pennsylvania, company said on July 29 that it would consolidate its solid hardwood flooring manufacturing at its plants in Beverly, West Virginia, and West Plains, Missouri. The Warren facility will close its doors Sept. 27.
Rebecca Montgomery, an economic analyst for the Arkansas Agricultural Experiment Station and its Arkansas Forest Resources Center, wrote the analysis for the Arkansas Center for Forest Business. The experiment station is the research arm of the University of Arkansas Sytem Division of Agriculture.
“The loss of 130 jobs at AHF will produce a total loss 275 jobs across the region resulting in the loss of $16 million in labor income,” Montgomery said. “County tax revenues will decline by $350,000 and state tax revenue will decline by $1.6 million.
“Arkansas’ gross domestic product will decline by $36 million,” she wrote. However, “though the initial impacts of the loss will be difficult, it will not be permanent as AHF workers find other jobs [and] the economy will recover.”
AHF said it would retain ownership of the plant and restart operations if conditions improved. However, “we do not foresee this happening soon,” AHF Products President and CEO Brian Carson said in a release. “It was a difficult decision because closing a plant impacts people and their local towns. We are extremely grateful for the dedication and service of all the employees over the years since the plant has been in operation.”
Statewide, flooring and millwork employs 903 people and pays an average annual compensation of $56,582, Montgomery said. Hardwood flooring mills are able to produce high-quality products from trees with numerous defects, providing landowners with income from trees that would bring lower prices from other types of mills.
The forestry industry, which includes the kind of work done by AHF, contributes some 4.1 percent of Arkansas’ GDP.
To learn more about the Division of Agriculture, visit https://uada.edu/. Follow us on X at @AgInArk.
About the Division of Agriculture
The University of Arkansas System Division of Agriculture’s mission is to strengthen agriculture, communities, and families by connecting trusted research to the adoption of best practices.
Through the Agricultural Experiment Station and the Cooperative Extension Service, the Division of Agriculture conducts research and extension work within the nation’s historic land grant education system.
The Division of Agriculture is one of 20 entities within the University of Arkansas System. It has offices in all 75 counties in Arkansas and faculty on five system campuses.
The University of Arkansas System Division of Agriculture offers all its Extension and Research programs to all eligible persons without regard to race, color, sex, gender identity, sexual orientation, national origin, religion, age, disability, marital or veteran status, genetic information, or any other legally protected status, and is an Affirmative Action/Equal Opportunity Employer.
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Media Contact:
Traci Rushing
trushing@uada.edu