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Hostess says jobs of 856 Indiana workers in danger

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Hostess Brands Inc., the maker of the iconic Twinkies snack, notified state officials Wednesday afternoon that it might close plants in 21 Indiana cities, throwing 856 employees out of work in the process.

About 340 of those workers are in Indianapolis, where Hostess operates five plants, located at 2801 Lafayette Road, 2929 N. Shadeland Ave., 3806 Madison Ave., 5353 W. 10th St. and 9233 E. 33rd St.

The Irving, Tex.-based company said the job cuts could occur in July, or 60 days after the notification it provided to the Indiana Department of Workforce Development, if it does not find a buyer or emerge from bankruptcy.

Columbus, where Hostess has 237 workers at three plants, would take the next biggest hit in Indiana.

In the Indianapolis area, a Hostess plant in Greenwood employs 29 workers and another in Anderson has 18.

The troubled company filed for chapter 11 bankruptcy reorganization in January and has been in discussions with potential buyers to complete a restructuring.

“However, it is possible that, despite our best efforts, certain events may occur that would require Hostess to sell all or portions of its business and/or wind down its operations and liquidate,” the company said in the state filing.

The company was founded in 1930 and has annual revenue of more than $2 billion.

It is the largest wholesale baker and distributor of fresh bakery products in the United States, and is the owner of the Wonder Bread, Nature's Pride, Dolly Madison, Butternut Breads and Drake's brands.
 

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  • Good or Bad?
    I read the article at the link in the last post and you have to look at what Unions did for their workers. In the short term, they got them better wages, guarantees to have a job doing this or that..... BUT in the long run what they got them was another company bankrupted by forcing them to do things that make no monetary since. They got their union workers un-employed.

    I'm not the least anti-union but I really think that this country needs to start getting smarter about how we do things.

    In the primary election we elected Mourdock and the reason (as printed by our media sources) is that he won't compromise. Well the Unions wouldn't compromise at Hostess. I'm not supporting Lugar or saying that just because our media outlets say Mourdock won't compromise means he won't... what I'm saying is that we have to take an honest look at all of our problems and begin to find real solutions that don't put all of us out of work. It will take compromise because we are a society of mixed people, of mixed ideas, of mixed _____ fill in the blank. There is no right for every single person or problem. We have to realize that, even when we don't agree with the outcome and even it if means sacrifice, sometimes we have to give in and compromise.

    I hope that the unions and the workers for the unions realize that they may have to give maybe even a lot to keep some of what they have and I hope that at least a majority of the voters will look at the "austerity measures" that other countries are having to face now are a real possiblility here if we don't compromise and work for solutions that work and make most people happy for what they've gained and mad at what they've lost. Otherwise the losses will be much greater.

    We have to compromise --give and get--- the give will hurt some but it has to be.

    It's the only way this GREAT system and country we live in will work and prosper and shine like the light it has been for 236 years.
    • Unions Again
      For another take on why Hostess is in trouble read the following link:
      http://radioviceonline.com/hostess-twinkies-vs-the-unions/
    • Twinkies
      Don't blame me. I eat my share, right out of the package, deep fried, for breakfast, dinner and supper. Soooooo good.
    • Is it just me...
      ...or does it seem odd that they would have so many plants in Central Indiana? Where are all those Twinkies going? It doesn't seem like they're jumping off the shelves at the gas stations. I would expect them to have maybe one plant in all of Central Indiana at most.

      On a bit of a tangent, did anyone else stopping buying these products partially in response to their ceasing to advertise the price of the products on the sales rack?
    • no surprise
      While I'm sorry about the jobs, this could have been predicted, but company has failed to use foresight. The market for eating unhealthy food (or faux food) is shrinking with the alarm about diabetes and obesity. They should have looked for a product to make that won't kill the consumer in the end. Maybe Americans are waking up -- hope it's not too late. And yes, what they say about Twinkies is true -- I once sat at a meeting where I could look out a window and see a Twinkie squashed up on some bricks in a courtyard and sheltered from rain, and the next year I attended a meeting in the same room. The Twinkie was still squashed on the bricks in the courtyard.

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    1. Apologies for the wall of text. I promise I had this nicely formatted in paragraphs in Notepad before pasting here.

    2. I believe that is incorrect Sir, the people's tax-dollars are NOT paying for the companies investment. Without the tax-break the company would be paying an ADDITIONAL $11.1 million in taxes ON TOP of their $22.5 Million investment (Building + IT), for a total of $33.6M or a 50% tax rate. Also, the article does not specify what the total taxes were BEFORE the break. Usually such a corporate tax-break is a 'discount' not a 100% wavier of tax obligations. For sake of example lets say the original taxes added up to $30M over 10 years. $12.5M, New Building $10.0M, IT infrastructure $30.0M, Total Taxes (Example Number) == $52.5M ININ's Cost - $1.8M /10 years, Tax Break (Building) - $0.75M /10 years, Tax Break (IT Infrastructure) - $8.6M /2 years, Tax Breaks (against Hiring Commitment: 430 new jobs /2 years) == 11.5M Possible tax breaks. ININ TOTAL COST: $41M Even if you assume a 100% break, change the '30.0M' to '11.5M' and you can see the Company will be paying a minimum of $22.5, out-of-pocket for their capital-investment - NOT the tax-payers. Also note, much of this money is being spent locally in Indiana and it is creating 430 jobs in your city. I admit I'm a little unclear which tax-breaks are allocated to exactly which expenses. Clearly this is all oversimplified but I think we have both made our points! :) Sorry for the long post.

    3. Clearly, there is a lack of a basic understanding of economics. It is not up to the company to decide what to pay its workers. If companies were able to decide how much to pay their workers then why wouldn't they pay everyone minimum wage? Why choose to pay $10 or $14 when they could pay $7? The answer is that companies DO NOT decide how much to pay workers. It is the market that dictates what a worker is worth and how much they should get paid. If Lowe's chooses to pay a call center worker $7 an hour it will not be able to hire anyone for the job, because all those people will work for someone else paying the market rate of $10-$14 an hour. This forces Lowes to pay its workers that much. Not because it wants to pay them that much out of the goodness of their heart, but because it has to pay them that much in order to stay competitive and attract good workers.

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    5. It is sad to see these races not have a full attendance. The Indy Car races are so much more exciting than Nascar. It seems to me the commenters here are still a little upset with Tony George from a move he made 20 years ago. It was his decision to make, not yours. He lost his position over it. But I believe the problem in all pro sports is the escalating price of admission. In todays economy, people have to pay much more for food and gas. The average fan cannot attend many events anymore. It's gotten priced out of most peoples budgets.

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