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Somerset Company Planning Layoffs
A Somerset health-care Company is planning to lay off 80 workers and shift its manufacturing to China, a shift the company says is essential to stay competitive here.
DeVilbiss Healthcare, which makes respirator therapy devices, is the most recent Somerset County business to send manufacturing jobs overseas. In 2005, for instance, Crane Plumbing in Somerset shifted its whole operation offshore.
DeVilbiss officials are discussing with the United Independent Aerosol Workers, the union representing about 180 manufacturing workers at its Somerset headquarters.
A final decision on layoffs expected next month.
Kees Regeling DeVilbiss President and CEO said, “This is not an easy decision.”
"Today we're struggling with our cost. We have concluded that it is impossible for us to continue in the marketplace where our competitors are selling for less. We have to look at alternatives."
A union spokesperson was unavailable for remark.
Regeling cited cuts in Medicare reimbursements for respiratory therapies and products as the cause for the layoffs.
The company said, Medicare funding for home oxygen therapy expected to plummet by 19 percent in 2009 as part of the Medicare Modernization Act and the Deficit Reduction Act.
Regeling said, DeVilbiss, with about 360 workers, would keep hold of about half of its 160-180 manufacturing jobs.
The proposed furloughs will do away with jobs that pay $10 to $15 per hour.
The manufacturing of oxygen concentrators, oxygen Tran filling systems, vacuum/suction pumps as well as plastics and electronics will be moved to a DeVilbiss-owned plant in China.
Regeling said, the transition would take about six months.
He said, manufacturing of oxygen conserving devices, continuous positive airway pressure devices and professional atomizers would remain in Somerset.