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Weekly UpdatesCosmetic Laboratories of America will begin this month a phase-out of manufacturing positions at its Chatsworth plant and transfer the jobs to a facility in Arkansas.
When completed by January, the layoffs will cut by nearly half the 335 employees in the Valley and reduce the number of shifts from three to two.
Cosmetic Laboratories is part of St. Ives Laboratories that is owned by Illinois-based personal care product manufacturer Alberto-Culver Co. The Chatsworth plant is an important part of the overall corporate strategy in that it makes private label personal care products for third party companies.
The work being transferred to Jonesboro in northeastern Arkansas is for Alberto-Culver's own brands, which include VO5 TRESemme, and Nexxus.
Even with the loss of up to 165 positions, the Chatsworth facility will remain fully occupied, and had in fact been stretched space-wise due to making Alberto-Culver brands there, said Dan Stone, vice president of corporate communications.
"There may be some short run (brand production) that remains there but primary it will be third party production," Stone said.
The jobs being lost in the Valley are primarily in manufacturing with a few office positions tossed in.
Where possible, employees who are being laid off will be offered jobs in Jonesboro. For instance, mechanics and compounders are highly skilled positions that are being transferred.
"We have quite a few who have expressed interest in going there," said Cindy Lange, director of human resources at St. Ives Laboratories.
Publicly traded Alberto-Culver, with $228 million in net profit for the 2008 fiscal year, has its roots in a Los Angeles beauty supply business that its owners later moved to Chicago.
In 1996, the company bought St. Ives Labs in a deal worth $120 million. At that time, more than 400 employees worked in the Chatsworth plant.
The Arkansas facility, completed in 2008 and later expanded to nearly a half million square feet, employs between 300 and 400 workers. It was built to ease capacity constraints at other Alberto-Culver manufacturing sites in Dallas, Toronto, and in Puerto Rico.
Alcohol-based products made in Chatsworth will also be transferred to Jonesboro, Stone said.
That corner of Arkansas, with close proximity to Memphis and major interstate highways and rail lines, is popular with large manufacturers. Among the biggest employers in the greater Jonesboro area are Nestle USA (frozen entrees), Frito-Lay Inc. (snacks), Delta Consolidated Industries (tool boxes) and Arkansas Glass Container.
The layoffs are unusual in that they are not directly related to the struggling economy as has happened at other Valley manufacturers.
In Los Angeles County, manufacturing is seen as a weak industry in a forecast earlier this year from the Los Angeles County Economic Development Corp.
The LAEDC foresees manufacturing shedding more than 20,000 jobs this year and nearly 14,000 in 2010.
When manufacturing companies do make employee cuts, the Valley Economic Alliance gets involved as early as possible to smooth the transition for those losing their jobs.
"We like to work with them before to see if there are resources they don't know about to prevent any layoffs," said Elan Shore, regional manager with the Alliance.
By MARK R. MADLER
Staff Reporter
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