Paper giant UPM aims to cut costs and capacity in the face of declining demand for printing paper.
Forest products firm UPM has confirmed that it is permanently shutting down one of the three production lines at its Rauma, Finland paper mill, making 179 employees jobless. At the same time, the company is cutting 41 service centre positions in Tampere, moving their jobs to lower-cost Poland.
UPM announced earlier that it planned to decommission the massive paper machine, which has been in service since 1971, two years after the mill opened. Of the 179 people handed pink slips, 159 were permanent and 20 temporary employees. They represent roughly a quarter of UPM's staff in Rauma, which now includes 520 permanent workers.
"We have focused on finding socially acceptable solutions for the employees affected with the clear intention to diminish the impact of this closure,” says Anu Ahola, Senior Vice President at UPM Communication Papers, who adds that "the consultation process was fair, open and constructive at all times".
UPM blames the shutdown on declining demand for graphic paper as more customers read periodicals in electronic form. The move will slash UPM's capacity for SC magazine paper production by 265,000 tons annually.
UPM also announced that it is closing a service centre in Tampere, moving operations to a new centre being set up in Wrocław.
The 41 employees made redundant in Pirkanmaa are being offered the opportunity to move to Poland next year. UPM has more than 900 workers in Tampere.