Maine company shows plight of paper, pulp industry

MILLINOCKET, Maine -- Stephen Shaw once was a lucky man. Back in the day, he could virtually roll out of bed and be at work at the paper mill next door. The plant was so busy it recruited folks right off the street, and Shaw and his wife, also a millworker, raised three children on healthy wages.

But those days are gone. And Shaw appears to be out of luck.

The paper mill closed in late December and filed for bankruptcy, and when it reopens in a year, town officials say, its new owners plan to employ only a fraction of the former work force. Even after spending 33 of his 54 years at Great Northern Paper Inc. here in this rural northern Maine town, Shaw may not have enough seniority to return to the plant.

"I don't feel very good, but I can't do much about it," said Shaw, looking at the silent stacks and empty mill buildings from his back yard. "Whether I'm going back to work or not, I don't know."

That uncertainty is a reflection of a greater unease about the future here.

Rethinking destiny

For more than 100 years, the paper mill in Millinocket -- along with another plant in East Millinocket -- has been much more than this town's major employer. It has been its very reason for being, creating and sustaining a community out of the wilderness to support its operations even through the Great Depression. The mill's closure sent shock waves through this town of about 5,000 people, forcing residents to rethink their destiny in a state known nearly as much for its vast forested lands as for its lobsters.

The pulp and paper industry nationwide has been in trouble in recent years, facing tougher overseas competition and serious price erosion. In the past five years, about 88 mills have closed in the United States, with a loss of more than 40,000 jobs; other mills have made drastic cutbacks, according to industry experts.

Maine, which is the second-leading paper-producing state after Wisconsin, is no exception. The state's relatively high production costs -- from generous wages and benefits to high taxes -- compounded matters, encouraging paper companies to neglect facilities and invest elsewhere, according to industry experts. Millinocket, about 60 miles north of Bangor, is one of the most remote mill towns in the nation, making its situation more perilous than most, they said.

"Maine is being pushed closer and closer to the edge of a cliff," said James A. McNutt, executive director of the Center for Paper Business and Industry Studies, a think tank at the Georgia Institute of Technology. "Millinocket is teetering."

30 percent unemployment

Workers from the bankrupt company and creditors, from large corporations to log haulers, are still owed millions of dollars, and the effect of lost salaries (mill workers average $50,000 per year) has trickled down to a region already struggling. A bank, a sporting goods store and a department store closed, and retail shops are struggling. Unemployment stands at more than 30 percent.

After the mill filed for bankruptcy in January, the railway serving Millinocket cut wages, and town officials suspended capital projects, slashed the budget by roughly $500,000. A local food bank has gone through nearly 400,000 pounds of food in the past six months, and many people are commuting to other parts of Maine or heading out of state.

"It's been devastating, to say the least. It's torn families up," said Hershel Hafford, pastor of Millinocket's I Care Ministries.

Town manager Eugene Conlogue agreed: "You have people who are looking for a job for the first time in their lives."