by Max Brantley
The Log Cabin Democrat in Conway is reporting that Hewlett-Packard will lay off 500 people at its Conway call center.
Employees apparently got the word at a company meeting. The layoffs will be phased in and workers will get two months' severance pay, the Log Cabin reported. It quoted HP and local politicians, who'd been briefed by the company.
HP opened the center in 2010, but the company has been in the proces of laying off 29,000 people nationwide because of a business downturn.
State and local officials offered more than $43 million in incentives to lure the operation to Conway. State and local cash payments totaled more than $12 million and the Conway Development Corporation built a building for the operation to HP's specifications. It was envisioned to employ 1,200. It's unclear today how many will remain employed there and whether the company has any obligations for repayment under the incentive plan.
Rio Rancho, N.M., went through a similar downsizing with a heavily subsidized HP facility similar to the one in Conway. That city had "clawbacks" in place to recapture some money when jobs were lost, according to this report. One New Mexico legislator wants to stiffen clawback rules because of undelivered HP promises there.
Talk Business details the Arkansas expenditures here, but doesn't include the $2 million local site prep and the value of the Conway Development Corp.'s investment. The state isn't ready to say if it has a claim to recoup any money. It's unclear if HP ever hit the 1,200 target. The company won't divulge employment figures. Gov. Mike Beebe's office says HP still plans to have a major presence in Conway.
UPDATE: More from Joe Holmes at AEDC:
There are clawbacks on the $10 million [state] Quick Action Fund. Exactly how much we don't know but will be meeting with the company the next few weeks to hammer that out. It will be based on totals of people employed, payroll, length of time employed etc. I will say they have been current on all agreements up until today.
The company informed us this morning they would be laying off approximately half of its workforce in Conway. HP has strict policies regarding releasing exact staffing figures, but they will continue to employ several hundred people.
The Conway Development Corp. issued a statement saying, in part:
HP is still a significant and positive influence on our economy. As economic developers we will continue to promote the Conway facility as a site for growing sectors within the company.
As an organization we will do what we can to facilitate successful transition for those affected and continue to attract jobs and economic opportunity to Conway.
The corporation owns the building and says two Conway companies have already expressed interest in talking to some of the displaced workers.
of the newly available space. A spokesman said a "majority" of the existing HP workforce will remain employed. There are no clawbacks required in the agreement between local supporters and the company, the spokesman said.
The HP boilerplate follows:
"As part of our efforts to streamline our business processes, advance innovation and deliver the best possible experience for our customers, employees and shareholders, on July 8, 2013, HP internally announced plans to restructure its Customer Support Specialist/Contact Center footprint in Conway, AR. This is a component of the plan announced on May 2012, which is designed to simplify business processes, advance innovation and deliver better results for our customers, employees and shareholders.
There will be no disruption in any of our services. Customers will still have access to HP's full portfolio of services with the same level of quality. As always, our customers, clients and communities whom we serve continue to be the cornerstone of our business. We reaffirm our commitment to providing innovative technology solutions to every community we reach. As well, HP will be taking steps to help our affected employees during this transition."