CHAMPAIGN — Clifford-Jacobs Forging Co. will eliminate its second shift on Friday, laying off 36 people, company President Bruce Wylie said Wednesday.
The move comes two years after the forging company in north Champaign added a second shift for the first time in 30 years.
Wylie said the layoffs come largely as the result of fewer orders from the natural gas industry and from Caterpillar Inc., which rank among Clifford-Jacobs' largest customers.
The downturn in orders affects not only Clifford-Jacobs, but competitors in the forging industry as well, he added.
"Bookings are dropping throughout the industry," he said.
After the layoffs, Clifford-Jacobs will continue to employ 155 at its plant at 2410 N. Fifth St., C.
Wylie said the company is "disappointed" it had to end the 3 to 11 p.m. shift, but "we just didn't have the work."
"We did all we could to minimize and delay that, but at the end of the day we had to make the call," he said.
The upcoming layoff includes forgers, inspectors and machinists — all of which are "good-paying jobs," Wylie said.
The cutback comes on the heels of a smaller layoff earlier this summer. Before that, the company employed more than 200.
Wylie said activity in the oil and gas construction sector has dropped off. With natural gas prices falling, there's less incentive to drill.
The construction equipment industry has suffered too, he said.
"Our largest customer is Caterpillar, and it recently reduced its forecast for the next few quarters," he said.
The natural gas industry uses steel forgings in drilling and "fracking," and Caterpillar uses forgings in its construction equipment.
Not all customer sectors are shrinking, though.
"We're looking at seeing growth in mining and aerospace," Wyle said.
Wylie said this year's downturn isn't as big or as rapid as the one Clifford-Jacobs encountered in 2009. He said he hopes to see a turnaround in a few months.
After adding a second shift in 2010, Clifford-Jacobs, a division of IMT, did a lot of on-the-job training. It also made significant investments, including $1 million for a new enterprise resource planning system and extra outlays for information systems.
"We're in it for the long run, and we remain profitable," Wylie said. But if the company had continued with the second shift, it wouldn't have remained profitable, he said.