Winston Salem Dell Plant Closing

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Winston Salem Dell Plant, Front
Dell received $281 million in local and state incentives when it decided to locate its manufacturing plant in Forsyth County in 2005. The agreement was for Dell to invest an additional $100 million and to create 1700 jobs by September 2010. It was supposed to maintain these jobs for at least a decade longer (until 2015).

This announcement came at a time when the Triad was hurting from the plummeting of textile and tobacco industries, and was therefore a welcome boost for morale. Unfortunately, a scant four years later, Dell has announced today to close the plant completely. By the end of November 600 employees will be laid off, a big increase from the 250 that were laid off earlier this year in March. The remaining employees will be terminated in January and the Dell plant will be closed completely.

The Dell Double Take

Back in June, following the March layoffs, Dell said it would hire back about 100 employees. To add insult to injury, because those employees were rehired on a temporary basis, they won’t be receiving severance payments now. This is a similar set up that took place during the various scheduled layoffs at HBI which resulted in those failing to volunteer to receive a reduction or complete loss of their severance package. In our opinion this approach to layoffs is detrimental not only to the morale of employees that stay on, but to the company’s reputation going forward.

Dell Gives Back all the Money

Winston Salem Dell Plant, SideUnfortunately for Dell, having not met the terms of their agreement with Forsyth County, will need to repay every penny of the $281 million they received in 2005. This comes at a time when Dell is already hurting from an industry cramped with competing products, lower demand, and ongoing job cuts in an increasingly prolonged recessionary environment. Furthermore, the lack of timely innovation is keeping it from growing its core business model into new areas.

Healthcare and Construction Takeoff in the Triad

On a more positive note, the healthcare and construction industries are projected to supply more jobs in the future and will potentially provide a foundation for business and economic growth in the Triad. Winston-Salem was listed in Business Week as one of the top 10 best cities to start over following the loss of employment during this recession. Reasons stated include lower cost of living and increase in demand in the healthcare and construction industries, which appear to be leading our way out of this recession, however slow and laborious that process may be.

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Alex is a Winstonite (and Salemite) and tennis enthusiast. You'll catch him hitting balls at Miller Park, grabing a cold beer at 1st Street Draft House, or chowing down on a tasty tomato pie at Mozelle's just about any day of the week.

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