DuPont Cuts Likely to Have Ripple Effect Across Del.
DOVER, Del. (WBOC) – Job loss at DuPont is a big loss for Delaware. Experts say the effect of cuts at the company will ripple through the state’s economy.DuPont is a company that over the past two centuries has become synonymous with Delaware. It announced layoffs for about a quarter of its workforce in the state on Tuesday. DuPont currently employs about 6,000 people in The First State. Of those, 1,700 will be losing their jobs.
The layoff announcement came a little more than two weeks after a different announcement that two chemical giants – DuPont and Dow – were planning to merge.
John Boyd, an economic development consultant, said job cuts were to be expected in the merger.
“This has to happen. This is business. DuPont is under global pressure to cut costs. And, of course, the chemical industry is going through a lot of restructuring,” said Boyd.
Michael Casson, an economics professor at Delaware State University, said this will hurt statewide.
“Potentially some of the short-term impacts will be tempered a bit because of some of the separation packages and the retirements that were pending,” he said. “But I think long term we’re going to see some economic impacts. We’re looking at high-paying jobs. I think always a challenge for a community, for a state is – how do we replace high-paying jobs with high-paying jobs?”
Losing all these high-paying jobs will hit Delaware tax revenues. Last week, simply based off only the merger announcement, state economic forecasters dropped personal income tax revenue projections by seven million dollars for the upcoming fiscal year.
And another major negative impact of the job cuts has nothing to do with money and everything to do with symbolism.
“It’s not just an average business that is shutting its doors. We’re talking about a business that has been a staple and a leader in our community for over 200 years,” Casson said.
Political leaders have been weighing in on the DuPont layoffs announcement.
Delaware Gov. Jack Markell called it “deeply disappointing.” U.S. Sen. Tom Carper said it was “very troubling.” And Rep. John Carney labeled it a “punch to the gut.”
Dow and DuPont will merge and then split the combination into three separate companies. One will focus on materials and plastics, one on agriculture, one on specialty products, like Kevlar and Tyvex.
DuPont announced Tuesday the specialty products company will be based in Delaware. There is no word on the locations of the headquarters of the other two companies yet.
Boyd said state governmental and economic leaders should push hard for the agricultural products company to be in Delaware.