When CRF Frozen Foods unexpectedly shut down in April and laid off about 300 workers, it could have been a blow for the Tri-City economy.
But six months after the Pasco food processor’s products were recalled beacuse of a Listeria outbreak, few of the company’s former workers have claimed unemployment benefits.
They found work with other food processors and related companies, employment officials believe. And it’s not difficult to see where the jobs are.
“Now hiring” signs flutter outside processors such as Twin Cities Foods. And recent investments by Lamb Weston, Ingredion and Volm highlight the strength of a sector that accounts for 5 percent of all wages earned locally.
Ajsa Suljic, regional labor economist, for the Washington Employment Security Department, expected a spike in unemployment claims when CRF announced layoffs. Month after month, they didn’t materialize.
“Individuals have multiple options. They move easily from one location to another,” she said.
Since April, the unemployment rate has only dropped, falling from 6.9 percent in April to 6.5 percent in August, according to federal labor statistics.
Food processing, a natural extension of the region’s agricultural prowess, is a critical reason.
Excluding wineries, Benton and Franklin counties boasted 38 food processing firms in 2015, including fruit and juice processors, french fry companies and vegetable companies, to name some of the Washington-grown products that get processed in the Mid-Columbia.
And that doesn’t include the Tyson meat processing plant just southeast of Pasco in Walla Walla County.
In July, the peak for food processing jobs, the Benton and Franklin food processors collectively employed nearly 5,000 workers.
The $270 million payroll in 2015 was 5 percent of the $5.4 billion in total wages paid in the region, according to the state employment office.
While CRF works to resume production, food processors are making significant investments in the Mid-Columbia:
▪ Ingredion Inc., a $5.6 billion global food manufacturer based in Westchester, Ill., closed a $1.2 million deal to buy its Richland plant and property from the Port of Benton. The former Penford plant turns potato waste from nearby Lamb Weston operations into starch — an edible ingredient sold to food manufacturers. The move to buy rather than lease the site secures its future here, said spokeswoman Claire Regan.
▪ Volm Co., a food packaging manufacturer based in Antigo, Wis., broke ground on an $8.5 million manufacturing plant on Industrial Way in Pasco in August. The 90,000-square-foot plant will support its customers, local food processors.
▪ ConAgra Foods, parent to Lamb Weston, is spending $200 million to expand its french fry plant in Richland. The move comes with more than 100 new jobs. Economic development officials say the investments highlight the importance of food processing in the region.
Carl Adrian, president and CEO of the Tri-City Development Council, or TRIDEC, estimates that half of the inquiries from businesses interested in the area in the past five years relate to food processing.
“It’s very important for the two county area,” he said. “There are opportunities to grow it.”
Adrian said he would like to see more companies such as CRF and Reser’s Fine Foods, which has a plant in Pasco, because they turn ingredients into finished meals. The region produces virtually everything needed to make pot pies, he noted.
“You’ve got a beef plant and some vegetables. Why not combine them?” said Adrian.
Rick White, Pasco’s director for community and economic development, said investments in the early 1990s in farm circles for the spraying of processing plant wastewater paid off in investments at the Pasco Processing Center, now fully developed.
The city and its partners are working to expand the capacity to handle more wastewater to woo more industry.
In the interim, Pasco is processing permits from related industries, including irrigation and farming equipment suppliers.
“You would be amazed to see the kinds of businesses that are locating in that (Highway) 395 corridor,” he said.
Attracting and retaining food processors is a top priority for both Tri-City leaders and the state.
Scott Keller, director of the Port of Benton, said the network of highways and railroads at the port makes it a natural spot for processors to receive farm-raised items by truck, process it, then ship it out by truck or rail to customers around the world.
Just last year, Preferred Freezer Services built a $115 million Richland facility to store and distribute frozen fruits, vegetables and meats.
Processing is a critical part of diversifying the region from its dependence on the Hanford site, and it takes advantage of the area’s low cost of living and transportation infrastructure.
“We have a wonderful transportation system that’s not contested,” Keller said.
The Washington Department of Commerce recognizes the strategic value as well.
Allison Clark, managing director for business development, said the department added a manager to focus on food processing in September.
The goal is to leverage the Northwest’s shipping to proximity to Asia, its low-cost hydro power and its diverse agricultural mix to expand production.
“Washington is such a leader in these areas. There is so much more that we can do,” she said.
Wendy Culverwell: 509-582-1514, @WendyCulverwell
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