SAINT HELENS, Ore. -- The Boise Inc. plant in St. Helens will be permanently eliminating pulp manufacturing and 325 employees will lose their jobs.

The layoffs were expected to happen in January.

Boise Inc. will not only halt pulp mill productions, but reduce paper production, according to Karen Punch, communication Manager.

The Idaho-based company says demand is down and costs are up.

In its quarterly report earlier this month, Boise said rising costs for wood fiber, energy and chemicals had hurt financial results at the mill.

“This is an extremely difficult but necessary decision to improve the financial performance of the company, while executing our strategic shift to packaging grades,” said President and CEO Alexander Toeldte.

Boise officials said 300 of the jobs are at the mill, and another 25 are in sales, marketing and logistics.

Boise expects to employ about 170 employees at the mill after its restructuring.

According to Boise Inc., another mill in Washington is also having large financial problems.

Wayne Powell has been an employee at the St. Helens Boise plant for eleven years. He said he wanted to talk to KGW even if it meant getting in trouble for speaking out.

“I don’t care. I’m going to tell it like it is because this story is… it’s outrageous,” said Powell.

Powell has one year left before retirement and told KGW he’s going to see what happens. He said,”If there’s a lifeboat I will climb on but this is ridiculous.”

Powell said “it’s a matter of corporate getting richer” and he feels sorry for the younger people who have recently been hired on.

The layoffs will not necessarily be based on employee’s tenure, said Karen Punch. In many cases, she said, it will depend on an employee’s capability and knowledge. She said agreement negotiations will be scheduled with the AWPPW Local 1 to determine the impact for union employees.

The town of St. Helens has a population of 12,000 and Boise Inc. is Columbia County’s biggest private employer.

On Monday, the unemployment numbers were released for Oregon showing that 14,000 jobs were lost in October.

The unemployment rate is 7.3% which is up a point from last month and that's almost a point above the national average.