The reopening of a plywood plant in Rogue River has brought 108 jobs and a bit of optimism to a lumber-dependent region hit especially hard by the economic downturn. Shuttered in 2008 as the housing market collapsed, the plant was purchased in early 2010 by Eugene-based Murphy Company for $3.6 million and reopened two months ago.

The plant opened in the early 1950s and has changed hands eight times. The previous owner, Milwaukie-based Panel Products, nearly doubled the floor space and added new machinery. They transformed the plant from a log-to-veneer operation to a veneer-to-plywood operation in hopes of cashing in on the housing bubble, says Murphy’s president John Murphy. But the bubble burst and so did the company.

More than 400 people applied for the open positions, including many former employees. “It’s an area that has had skilled labor unemployed for two years,” says Murphy.

Murphy bought the plant out of receivership at a discount, banking on a modest resurgence in national housing starts. “I’m not a believer that we’re coming out of the housing problem overnight,” says Murphy. Though he says industry analysts expect about 675,000 national housing starts in 2011, “We’re budgeting for around 640,000.”

Murphy Company is not the only one benefiting from the reopening. According to Rogue River city administrator Mark Reagles, the plant accounted for roughly 5%-8% of municipal water treatment receipts. The city also lost tax revenues from the closure.

“When you’re running a tight ship, that kind of loss can affect [you],” he says.

Depending on market conditions, Murphy says that three or more shifts will be added to the plant. “Anything in this economic climate is important and welcome,” says Reagles. “It makes the community look good.”

PETER BELAND