The company unveiled its plans for the upgrade on Wednesday. The expansion is needed to build Arctic patrol vessels and navy warships for the federal government under the $35-billion National Ship Procurement Program.
The company said it will begin work on the first vessels sometime in the second or third quarter of 2015. Irving officials told a media briefing on Wednesday that until then, it does not have enough work to keep its current workforce of 900.
Scott Jamieson, vice-president of programs at the shipyard, would not say how many will be laid off. He said Irving hopes to lessen the numbers by attracting more businesses to the yard.
The layoffs are expected to be completed by the end of September “followed by normal fluctuations,” said Jamieson.
He said once work begins on the Arctic patrol contract, employment will ramp back up reaching a peak of 2,000 to 2,500 between 2020 and 2021.
"It is regrettable. We value our workforce. We will keep in touch with them. Hopefully people will want to come back once we have the shipyard which will be the most modern and offer long-term sustainable work," Jamieson said.
The company got a $260-million loan from the provincial government in March 2012 to assist with the shipyard's upgrades.
They include the building of an assembly hall and painting facilities.