About three dozen employees have lost their jobs at the Georgia-Pacific gypsum plant in Sigurd, with adverse economic conditions being blamed for the layoff of nearly half of the employees.

Wallboard manufacturing will be discontinued, but the plant will continue to produce plaster products. That will result in employment for 40 to 45 people, including office personnel.Efforts are being made to provide employment for some of the workers at other plants, said Lynn Breinholt, plant controller.

Five employees have taken early retirement through an incentive program, while some have been transferred to the plaster mill through a seniority system, said Gordon Jessen, president of the local chapter of the International Brotherhood of Boilermakers Union.

The plant has been operating only one shift five days each week because of a "soft market demand" for building products, Breinholt noted. A curtailed work schedule had reduced most of the board plant workers to less than 40 hours per week.

Meanwhile, the nearby U.S. Gypsum plant continues to operate at near capacity. The plant is working three shifts a day six days each week, said Junior Lund, office manager for human resources.

The U.S. Gypsum plant is principally engaged in wallboard production, employing about 80 people.

Georgia-Pacific and the U.S. Gypsum Co. have been key sources of employment and important to the economy of Sevier County since the 1940s. Manufacturing of gypsum products has provided the only employment for many of the county's residents, while farmers have found supplemental income by working at the plants.