DATE: Thursday, May 22, 1997                TAG: 9705220515

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER 

                                            LENGTH:   55 lines

NORSHIPCO MAY LAY OFF 1,200 WORKERS LAYOFFS MIGHT NO HAPPEN, DEPENDING ON PENDING CONTRACT AWARDS.

Norshipco announced Wednesday that it may have to lay off as many as 1,200 shipyard workers - more than half of its 2,200-person work force - in the next 60 days.

If the layoffs occur, they could act as a brake on the region's economic growth by boosting unemployment and slowing consumer spending. For example, March layoffs of Metro Machine Corp.'s nearly 500-person work force boosted the region's unemployment rate by 0.1 percent.

Like Metro Machine, Norshipco is facing a lull in defense-related repair contracts. The big Norfolk shipyard at the mouth of the Elizabeth River's Southern Branch doesn't have enough work on the books to keep its workers busy.

However, Norshipco doesn't expect to have to lay off all 1,200 employees. It has bids out on several contracts that have yet to be awarded.

``We are aggressively bidding new contracts and are confident that these layoffs will be few and of short duration,'' said John L. Roper IV, Norshipco's executive vice president.

Roper characterized Norshipco's handing out of layoff notices as the worst-case scenario it is required to assume by federal labor law.

``We can only project based on the work we have in hand,'' Roper said. ``I hope there's no lull at all. I hope we don't have to lay off a single person. It all depends on what work we get.''

The layoffs could hit just under 1,000 hourly workers who are represented by Local 684 of the International Brotherhood of Boilermakers, said Gary Daniel, the local president.

``I've been through this before and it's never pleasant,'' Daniel said. ``We've just got to cross our fingers and hope we never get to that level.''

Daniel said his Boilermakers are ``talented and resourceful mechanics who can probably find work quickly if they have to.''

The remaining 200 or so layoffs could come out of the yard's non-unionized work force.

No layoffs are expected until June at the earliest, Norshipco said in a statement.

While the yard doesn't have much work on its logs for June and July, Norshipco said it expects an upswing in work by August because of the Navy's seasonal deployment and training cycles.

Also, the federal fiscal year ends Sept. 30, which means the Navy will soon enter a new budget year with fresh funding for repairs and overhauls. In the past, funds for repairs have thinned as the fiscal year comes to a close.

In the meantime, Norshipco will keep its remaining workers busy with a year-long conversion of the ammunition ship Mount Baker, a container barge due in June and two commercial tankers, one due in June and one in July, Roper said. It also has five cruise ships coming in this fall. ILLUSTRATION: [Color Photo]

Norshipco is facing a lull in defense-related repair contracts.

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