A manufacturing company has announced 50 redundancies in the North Island town of Dannevirke, blaming challenges faced by the carpet industry.
Up to 50 staff from the Canterbury Spinners factory were told on Friday morning that they are likely to lose their jobs by September this year.
The company, owned by carpet manufacturer Godfrey Hirst, sent much of its production work to the Dannevirke mill after the February 2011 earthquake destroyed its factory in Christchurch.
The spinning operation will close, but dyeing will continue.
Godfrey Hirst spokesperson Geoff Senescall said the company has struggled to compete with international manufacturers such as China and has also been hit by the loss of the Christchurch factory.
First Union general secretary Robert Reid said the news came as a complete shock and was likely to affect much of the small community. The union is negotiating redundancy packages with the company.
Earlier this year, Godfrey Hirst bought Summit Wool Spinners in Oamaru in a deal which saw 192 staff made redundant as part of the sale agreement.