Ripples of worry spread at news of EMC layoffs

But Bill Morgan, owner of the Golden Spoon restaurant on Main Street, was rattled after hearing last week that data storage giant EMC Corp., headquartered a mile away, would be laying off 2,400 employees, 600 in Massachusetts.

"I don't think it can be positive," he said. "Any time you lose people coming into town, it has an effect on all the small shops."

EMC's announcement left unanswered questions about the potential impact on communities in the region where the Fortune 500 company draws its local workforce. A spokesman said the company will continue obtaining permits for a 1.5-million-square-foot expansion of its campus on the Southborough-Westborough border, but is keeping its long-range options open; officials have said the facility, proposed to serve as EMC's new corporate headquarters, could have up to 6,000 employees.

Nor would EMC say who among its 9,000 employees in Massachusetts would be affected by the layoffs, which represent not quite 7 percent of its workforce in the state. In addition to its Hopkinton and Southborough/Westborough locations, EMC employs workers in Franklin, Milford, Newton, and five other communities across the state. Worldwide, EMC has 38,000 employees, according to the corporate website.

Southborough's town planner, Vera Kolias, said she expects the region will take a hit from the layoffs. "EMC is a key figure in the MetroWest economy, so it's certainly not good news," Kolias said.

EMC spokesman Dave Farmer said it is a "safe assumption" that some of the employees laid off would come from the Hopkinton headquarters, but he wouldn't go into further detail. The layoffs are slated to take place over the next 18 months.

While the company continues to pursue permitting for the complex in Southborough and Westborough, Farmer said, EMC has "no immediate plans for a specific development."

"It's an option for the future," Farmer said. "It's safe to say we're more likely to consolidate rather than expand real estate in the near term."

Paul Matthews, executive director of the 495/MetroWest Corridor Partnership, said the impact of the layoffs will be diffused across the communities where the employees live, and predicted that the high-skilled workers would probably have little trouble finding new jobs.

"The fact remains that despite the layoffs, EMC is going to continue to be a tremendous employer across the state and in this region," Matthews said. "I think the good news is the company has taken steps to center their long-term future here."

Still, some local business owners said they worry about the effect on the local economy.

Clelland Johnson, owner of Hopkinton Wine & Spirits, said he has already lost a regular customer - an EMC employee who lived out of town and was recently laid off.

"Certainly, if they live out of town and they don't have any reason to come back to Hopkinton, that's a risk for us," Johnson said. Liquor stores are commonly thought to be more insulated from economic downturns than most businesses, and Clelland said that while he expects an off year, he thinks the EMC layoffs will more directly affect local restaurants.

"I think that the layoffs are inevitably going to affect the amount of professional clothing that comes in," said Mindy Wills, an employee at Hiller's Cleaners. She said that some customers have already taken clothing out of storage and asked to pay off their bills in installments after being laid off, although she didn't know whether they had worked for EMC.

But some observers see cause for optimism amid the uncertainty.

"I just don't see it being some great shock to the local economy," said Brian Herr, chairman of the Hopkinton Board of Selectmen.

Kolias, the Southborough town planner, said the town has not been making plans based on the EMC expansion project, since company officials had said they were working on a build-out timeline of 5 to 15 years. The two towns changed zoning to accommodate the project in 2001, but Kolias said the development is far from ready to break ground, still needing special permits and a site plan review, plus approval from the Conservation Commission.

The project would expand EMC's campus in Southborough and Westborough, currently around 700,000 square feet, to a total of 2.2 million square feet, and would add seven new buildings and a wastewater treatment facility, according to the most recent plans filed with the town.

"It's the largest project that we've ever seen," Kolias said. "It's a boon for the local economy, when you have a company that's looking to expand in such a meaningful way."

But, Kolias added: "Were it to not occur, it's not as if the company is packing up and leaving. We've always known that this was a very long-term project."