RIPPLE EFFECT Old Town’s G-P mill is closed. Four hundred are jobless. Now, the community has begun to feel the…

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Georgia-Pacific Corp.’s decision to shut down its Old Town tissue mill and lay off 400 workers could affect more than 1,000 additional jobs in the area, a business specialist says.

James McConnon, University of Maine Cooperative Extension business and economics specialist, said Thursday the mill is closely linked with the area’s economy.

“If it turns out that the mill does not reopen in any form, then that employment and that payroll is lost. Then there’s going to be tremendous ripple effect throughout this region and also throughout the state,” he said.

That ripple effect already is being felt throughout the community and surrounding towns, and it isn’t likely to disappear anytime soon.

“Right now, the current situation is that the mill is closed and the state and G-P are looking for a buyer,” McConnon said. “So we’re kind of in a state of flux at this point.”

The effects on 1,000 other jobs stem from what economists call an employment multiplier – a figure used to determine how closely various sectors of the economy are linked.

“For every job in the pulp and paper industry, there’s an additional 2.5 jobs supported in the economy statewide,” McConnon said. “That’s a high multiplier compared to the average retail employment multiplier of about 1.7.

Jack Cashman, the state economic development commissioner, said the ripple effect “is huge. We’ve got chip mills down. We’ve got loggers and truck drivers affected, as well as the small businesses that depended on them.”

When the mill closed March 16, G-P agreed to work with the state for 60 days to find a buyer. That 60-day deadline passed more than a month ago with no sale – and there’s still no sale.

Although both G-P and state officials continue to say that negotiations are under way, the futures of those who were working at the mill, in addition to others in the community affected by the closure, remain unclear.

With such a large number of people affected by the closure, Cashman said the state is concentrating hard on trying to re-open the facility, “which we will do,” he said.

Retailers and other businesspeople in the area not only are seeing the impact in their sales numbers, they’re also hearing firsthand from their customers about the fears and anxiety.

“There’s a real uncertainty of the community right now,” Governor’s Restaurant owner Randy Wadleigh said Thursday. “I think people are just cautiously optimistic, but maybe the reality is it won’t open again.”

Wadleigh said business has dropped off since the March mill closure, more noticeably in May. Some of that loss may be related to University of Maine students leaving for the summer, but Wadleigh attributed at least some of it to the mill shutdown.

Wadleigh has let the equivalent of two full-time employees go, but is confident that things will be OK through the summer months and early fall because there are tourists stopping in to eat, and university activities will bring in customers in the fall.

“I’m more concerned with the winter months,” Wadleigh said.

Rumors about what’s holding up the mill sale run through the community daily.

“It’s all rumors, so you just sort of have to isolate yourself from that and hope for the best,” he said.

Community members have said they feel something will go in at the mill site, but that it will be on a much smaller scale, Wadleigh said.

“But something is better than nothing,” he said.

A local business owner who owns a couple of businesses in town said he has seen less foot traffic at both locations.

“Overall business is down. Overall revenue is down,” he said. “The average transaction per customer is down.”

He hasn’t had to cut staff yet, but said business is getting worse the longer the mill stays closed.

For some, it’s a difficult time of year to determine why business is slow.

“It’s hard to really tell with the university being down for the summer,” Joey Ouellette, a manager at Skeeter’s Redemption Center & Store, said Thursday. He noted that UM students and staff make up more than 50 percent of the business’s customer base when school is in session.

“I don’t know if it’s because of the university or because of the mill being shut down,” Ouellette said.

At the Old Town-Orono YMCA, executive director Jill Nitardy said she hadn’t noticed a drop in memberships.

The YMCA has offered G-P employees free use of the facility while they’re out of work.

“We did have a fair number of people who took advantage of that,” she said.

A few parents took their children out of the after-school program when school still was in session because parents were home instead of working.

“I wouldn’t say it was significant, but there was an impact,” she said.

Parents also are signing up their children for summer camps, but are waiting until the last minute rather than planning ahead because there’s so much uncertainty, Nitardy said.

“The Y is used for a lot of these people to help their social network,” she said. “They’re not seeing other people at work, but they’re seeing them at the Y.”

Membership at the facility was up before the mill closed and continues to be strong.

“I think the biggest thing is we have a lot of people that come here that talk about [the mill shutdown], and what I hear is uncertainty – just not knowing what the next day is going to bring,” Nitardy said.

With the summer months near, children are out of school and Crossroads Ministries Executive Director Brenda Davis said she has an urgent need for lunch items, such as mayonnaise, marshmallow fluff and jelly. There also is a need for nonfood items such as laundry and dish detergent, shampoo, deodorant, diapers, and trash bags.

The Old Town food pantry has seen a significant increase since the mill closed in the number of families and individuals seeking assistance.

In March, there was an increase of 28 families; in April, 32; and in May, 19. This month already Davis said 13 new families have applied for assistance.

Not all those seeking help were employed at the mill, but the majority have been affected by its closure.

“We had one couple come in whose hours at a sandwich shop had been cut from 40 hours to 12 hours per week,” Davis said.

Recalling a conversation with the woman who does her hair, Davis said the woman said, “Our clients from Old Town have dropped by 25 percent, and each shift has been cut by two hours since the mill closed.”

At some point, the impact likely will level itself out.

“We know at some point another business, hopefully, will come back in there,” McConnon said. “The economy is pretty resilient, and it’s also very complex. No one can know for sure what the total impact is going to be.”