Lots of questions after Klaussner closing; here are some answers

ASHEBORO — On Monday, Aug. 7, some Randolph County workers awoke to shocking news. Klaussner Furniture, a company that had been in operation in Randolph County for 60 years, abruptly closed. 
The only forewarning received by the workers, local government and the rest of the county was a terse notice.

“As the result of challenging and unexpected business circumstances impacting our operations, Klaussner Furniture Industries, Inc. and its direct and indirect subsidiaries ("Klaussner" or the "Company") must unexpectedly wind down the operations.

“Klaussner anticipates closing all of its facilities entirely, and that process is underway as of today, August 7, 2023.”

As of Wednesday, Aug. 10, the N.C. Department of Commerce WARN (Worker Adjustment and Retraining Notification Act ) webpage listed six notices in Randolph County and one in Montgomery County for permanent closures of Klaussner facilities. The notices list 826 jobs lost in Asheboro in Randolph County and 58 in Candor in Montgomery County.

Klaussner is owned by Monomoy, a private investment firm in New York. Monomoy bought Klaussner in 2017.

Reaction in the community

The development shocked many in the community.

“I don’t think anyone knew,” said Lisa Bennett, the marketing and research manager for the Randolph County Economic Development Corporation (EDC).

Bennett said EDC and other organizations in the county are scrambling to address the fallout from the abrupt decision.

John Ogburn, Asheboro city manager, echoed Bennett’s statement. The city did not have any indication that operations at Klaussner were in danger of ceasing.

Ogburn said Randolph County Commission Chair Darrel Frye and he are in contact with U.S. Sen. Thom Tillis about the situation. He added that the city’s finances would not likely take a significant hit due to the closure. Klaussner was not a major water user and Monomoy is still responsible for paying any real estate taxes on the property.

The impact is more psychological.

“You hate to lose a legacy employer like Klaussner,” Ogburn said in an interview. “Klaussner was always a good place to work. Right now, our thoughts are on the injury that the good people who worked are going through.”

Ogburn pointed out times are tough for the furniture industry right now. After the boom in sales that occurred during the worst of the COVID-19 lockdown, the industry is struggling to adjust. In an article in the trade magazine Furniture Today in January, industry insiders cited high shipping costs, a glut of inventory and low demand as some of the issues taxing furniture manufacturers.

Ogburn noted that during the pandemic lockdown, a lot of people spent money on their houses as they were forced to stay home. Financial help from the federal government in the form of direct disbursements to individuals helped to fuel a buying frenzy in home furnishing and home improvements.

“But there’s only so many living room sets you need,” Ogburn said.

For those who point to the high number of jobs available in the area, Ogburn said transitioning to a new employer isn’t that simple.

“Many of these were skilled workers in jobs that paid well,” he said. “Even with unemployment low in the county, I am worried about people being able to find a job that will match their skills and will pay as well as the one they lost.”

In June, Randolph County had an unemployment rate of 3.7 percent, up slightly from May’s 3.5 percent. That compares to 4 percent unemployment from the year before.

Reaching out to those impacted

If there is a bright spot in the situation for the laid off workers, it is the response in the community. 
Will Early, workforce business services lead for the Piedmont Triad Regional Council, said his organization is working with NC Works and Randolph Community College as part of the state’s Rapid Response Team.

“We’re lucky to be working with great partners like the community college, EDC and others,” he said. “So far, we’ve had a really good response.”

NC Works Career Center, 600 S. Fayetteville St. in Asheboro, reports activity at that location has been brisk as many impacted workers have already come in for help in signing up for unemployment and checking into job opportunities.

Early said the center will be hosting three job fairs over the next two weeks. On Aug. 15 and Aug. 29, a job fair will be held from 10 a.m.-3 p.m. at the Asheboro campus of RCC at 413 Industrial Park Ave. On Aug. 22, another job fair will be held from 10 a.m.-3 p.m. at the Archdale campus of RCC at 110 Park Drive.

“We’ve had 42-43 businesses indicate to us that they will be participating in at least one of these events,” Early said.

Representatives from other area furniture manufacturers are expected to be on hand but Early said there will be other industries and businesses there as well, like manufacturers of items other than furniture and law enforcement agencies.

Andrew Beal, communications manager with the Division of Workforce Solutions with the NC Department of Commerce, said laid off workers interested in receiving training for a new career can apply through NC Works for programs like the federal Workforce Innovation and Operations Act. Beal said this program helps displaced workers with payment for education and training classes.

Early said businesses can benefit from certain programs as well. Working with the RCC Career Pathways program, companies can get help covering the cost of retraining new workers to adapt their skills to a new job.

As for the company holdings

As Klaussner employees move on to their next career, there is no information on what will happen to the company’s properties.

In Randolph County, according to the county GIS, there are five properties listed under the name ARG KLSLBNC001 LLC, not Monomoy. These include sites at 301 Lewallen Drive, 263 Lewellen Drive, 905 N.C. 49 South and 4402 U.S. 220. A fifth property valued at $12,400 does not show an address but is attributed to ARG KLSLBNC001 LLC. 

In total, those properties have a tax value of over $35 million as reported on the county’s tax records. This does not include any inventory or machinery on site, nor does it include the Klaussner facility in Candor.

What will become of the property is unclear. Early said Piedmont Triad Regional Partnership has had limited contact with Monomoy. None of the government officials reached for this report seem to have heard from the company, either. Efforts to reach Monomoy Capital Partners based in New York were unsuccessful.