By David Pitt
The Associated Press

NORTH CANTON, Ohio - Maytag Corp. announced a major restructuring plan Friday that calls for its subsidiary, vacuum maker Hoover Co., to move its headquarters from northeast Ohio to Iowa, eliminating hundreds of salaried jobs here.

It's the second time in less than a month that a major northeast Ohio employer said it's moving jobs from the Canton area. Timken Co. said in May that it plans to close three bearings plants in the area that employ 1,300 workers because of declining production.

Maytag, the Newton, Iowa-based home and commercial appliance maker, said it will restructure its businesses to consolidate the Hoover Floor Care, Maytag Appliances and corporate headquarters divisions. The move will save Maytag $150 million annually and allow it be more competitive, officials said.

The plan includes shedding 1,100 jobs, or 20 percent of Maytag's salaried work force of 5,800. Manufacturing jobs were not affected. Under the restructuring, Maytag's total work force would fall to 19,500.

Ralph F. Hake, Maytag's chairman and chief executive officer, said in a statement that the decision was difficult but necessary, partly because of weak sales of Hoovers.

"Maytag will be a much leaner organization, capable of better serving customers and more rapid decision-making," Hake said.

Maytag refused to say how many salaried workers in North Canton would lose their jobs, but spokeswoman Lynne Dragomier said the Hoover headquarters would be the hardest-hit.

Mayor Tom Rice said the city hasn't figured out how much of the $1.5 million in tax revenues North Canton gets from Hoover will be affected. "But it will be significant," he said.

The $1.5 million represents about 15 percent of the city's tax revenue, Rice said.

Hoover won't say how many are employed in North Canton. Rice and Jim Repace, president of International Brotherhood of Electrical Workers Local 1985, said there are about 600 salaried employees in North Canton and 1,155 manufacturing employees in all of Hoover's Stark County facilities, with nearly all of them in North Canton.

The company also lowered earnings guidance for the second quarter and all of 2004 to between $1 and $1.10 a share. Analysts surveyed by Thomson First Call had expected full-year earnings of between $2.25 to $2.40 a share.

Maytag said expects the "one-company" transformation to improve market competitiveness and achieve an 8 percent operating profit margin goal in the first quarter of 2005.

Analysts earlier this year said Hoover was a weak point for Maytag. In the first quarter, Hoover revenues dropped 22 percent and the brand lost market share in both higher-priced vacuum cleaners - those selling for $300 or $400 - and at the lower-end levels below $100.

The announcement prompted Fitch Ratings, a New York-based bond rating service, to revise its outlook for Maytag from stable to negative, said analyst Tom Razukas.

Maytag shares fell $2.01, or about 8 percent, to $24.28 Friday on the New York Stock Exchange.