For many of its 115 workers, the shuttering Saturday of Seattle’s generations-old Foss Maritime shipyard came as a shock.

A tugboat still sat in the yard, awaiting repairs. Last week, workers were “packing up trucks for work that was supposed to be happening on Monday,” said Cody Taylor, a Foss warehouse worker who, like all of his colleagues, now faces a layoff.

But for those who thought to look, plenty of clues pointed to the facility’s likely closure.

Years of disinvestment had left the pavement at Foss’ Lake Washington Ship Canal facility dotted with sinkholes, and its piers too unsteady to bear the weight of forklifts, said James Waring, 33, and an 11-year Foss employee. Since 2019, Foss has been trying to disentangle itself from pension obligations to workers at the shipyard.

Foss is the latest in a long string of boatyard closures to hit Seattle, signaling for some the slow erosion of the city’s historic shipbuilding industry. Century-old boatyard Fishing Vessel Owners Marine Ways closed earlier this autumn, CEO Dan Payne confirmed, following Chapter 11 bankruptcy proceedings sparked by another pension dispute. Three of Seattle’s biggest boatyards — Vic Franck’s Boat Co., Dunato’s Boatyard and Jensen Motorboat Co. — have also closed in recent years.

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Foss Maritime president Will Roberts said in a statement that the shipyard has been sustaining losses for "several years." The company has made "wide ranging" efforts to keep the shipyard viable, he said, including "considering options for expanding into new construction as well as exploring buyers for a potential sale, which ultimately did not materialize due to insufficient market interest."

"Our goal has always been to preserve the continued operation of the yard," he said. "Unfortunately, no such path exists."

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Foss, which operates a fleet of tugboats on the West Coast, as well as in Houston and Mobile, Alabama, was purchased by Seattle-based maritime conglomerate Saltchuk in 1987. Foss tugs will continue to ply Puget Sound waters — they'll just have to go elsewhere for repairs, a company spokesperson confirmed.

The relatively high costs of labor, underfunded pension plans and constant pressure for waterfront development are undermining Seattle's historic shipbuilding industry, insiders said.

Nevertheless, Seattle's shipbuilding trade lives on, said Sam Laher, a shipbuilding instructor at Seattle Central College — preserved in his classroom, bespoke boatbuilding co-ops and the remaining big names in the industry, including Vigor, Pacific Fishermen and Lake Union Drydock Co. A new high school in the Highline School District, supported by the Port of Seattle, also aims to train young people in maritime trades.

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Seattle's maritime industry is "not flashy," said Peter Tarabochia, president of the Seattle Marine Business Coalition, which counts Foss as a member. "It’s not Amazon, Google or Facebook. ... But the maritime industry is still thriving. As long as you need to move people and goods across water, and I don't see that going away any time soon, there will always be a maritime industry to support that."

Still, employment in the shipbuilding sector is falling statewide, even as Washington adds jobs overall. The number of Washington workers building and repairing ships and boats declined nearly 15% between 2010 and 2020, according to data from Washington state's Employment Security Department. Total Washington state employment has grown by roughly the same amount in that period.

Pension issues have played a role in at least one recent closure.

Fishing Vessel Owners filed for bankruptcy in mid-2019 after the Marine Carpenters Union assessed a $1.2 million pension plan withdrawal fee, according to correspondence and court documents reviewed by The Seattle Times. The boatyard, the first tenant at Fishermen’s Terminal, had tried to stay solvent for years before that, Payne said, including by pivoting into yacht repair.

Other shipyard pension plans are also struggling to meet their obligations, a review of Department of Labor warnings shows.

"Every shipyard is going to get hit with pension issues," Payne warned.

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Foss and a coalition of unions representing workers at the boatyard had been mired in contract negotiations since early 2019, with workers rejecting proposals for a pension buyout. By this summer, Foss had stopped responding to the unions’ information requests, said Waring, a member of the negotiating committee on behalf of the International Brotherhood of Boilermakers Local 104.

Roberts said that Foss "enjoys productive and cooperative relationships with our labor partners." The company "has been consistent in communicating that the future of the Seattle shipyard hinged on many factors."

The closure was effective immediately Saturday, but Foss will pay workers' salaries for another two months, the company said.

Business groups representing Seattle's maritime sector cautioned against reading too much into the Foss closure.

"There’s always this 'end-of-an-era' conversation. And yet [the maritime industry] is still here," said Eugene Wasserman, the president of the North Seattle Industrial Association, a business organization that lobbies on behalf of maritime and manufacturing companies near the ship canal. "What an individual business does or doesn’t do isn’t a reflection of the industry."

For some workers, the shutdown nevertheless marked the close of a chapter.

"At the end of the day, it’s heartbreaking that the yard’s closing," said Taylor, 43. "I assumed that Foss was stable. But if the math’s not there to keep a business viable, then it’s not there."