Plant Closings and Their Regulation in Maine,1971–1982

Abstract

This paper describes the plant closing regulations adopted in Maine during the 1971 – 81 period and documents a pattern of relatively poor compliance with the advance notice and severance pay requirements of the law. Data on the number of workers laid off in major plant closings, on prenotification of workers, and on state and local unemployment rates provide the basis for an econometric estimate of the effects of closings with and without early notification on local unemployment rates and the size of the local labor force. The results suggest that advance notification significantly lowers the unemployment resulting from a closing.