One of the largest employers in Navajo County began handing out pink slips today. KJZZ’s Al Macias reports community leaders are worried about the impact on small towns already struggling in a tough economy.

AL MACIAS: More than 300 people work at the paper mill in Snowflake in northeastern Arizona, or they did until today. Catalyst Paper, the mill’s owner announced it was closing Sept. 30. The company says the demand for newsprint has dropped every year since it took over the mill in 2008. That and increased operational costs forced the closure. Today employees and community leaders got the word. Charlotte Hatch is the executive director for the Snowflake Chamber of Commerce.

CHARLOTTE HATCH: That’s going to be quite a few families out of jobs and our job market is pretty slim right now. So that means they’ll have to go elsewhere to find jobs.

MACIAS: Hatch says small businesses in the towns of Snowflake and Taylor who depend on sales to mill employees may also not survive. The mill has been in operation since the 1950s.