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Somerset company laying off 80 Health care firm moving to China
SOMERSET, Pa. — A Somerset health care company is planning to lay off 80 workers and move its manufacturing to China, a move the company says is necessary to remain competitive here.
DeVilbiss Healthcare, which makes respirator therapy devices, is the latest Somerset County business to send manufacturing jobs overseas. In 2005, for example, Crane Plumbing in Somerset moved its entire operation offshore.
DeVilbiss officials are negotiating with the United Independent Aerosol Workers, the union representing about 180 manufacturing workers at its Somerset headquarters.
A final decision on layoffs is expected next month.
“This is not an easy decision,” DeVilbiss President and CEO Kees Regeling said Thursday.
“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 representative was unavailable for comment.
Regeling cited cuts in Medicare reimbursements for respiratory therapies and products as the reason for the layoffs.
Medicare funding for home oxygen therapy is expected to drop by 19 percent in 2009 as part of the Medicare Modernization Act and the Deficit Reduction Act, the company said.
DeVilbiss, with about 360 workers, will retain about half of its 160-180 manufacturing jobs, Regeling said.
The proposed furloughs will eliminate jobs that pay $10 to $15 per hour.
The manufacturing of oxygen concentrators, oxygen transfilling systems, vacuum/suction pumps as well as plastics and electronics will be relocated to a DeVilbiss-owned plant in China.
The transition will take about six months, Regeling said.
Manufacturing of oxygen conserving devices, continuous positive airway pressure devices and professional atomizers will remain in Somerset, he said.
Patrick Buchnowski is a staff writer for the Johnstown Tribune-Democrat.
