Stature Electric Inc., Watertown, dropped its work force by 9 percent this week, citing significant reductions in orders for its gear motors and transaxles from commercial and industrial manufacturers.

General Manager Bill Stout said a sluggish national economy has hurt the construction and medical mobility industries, which are the company's two primary markets.

Mr. Stout said demands for high-end wheelchairs dropped sharply after the federal government decided last year to pay less toward wheelchair purchases made by Medicaid and Medicare recipients. He said those affected either purchased a lower-end wheelchair or went without one.

Most low-end wheelchairs, he said, are manufactured completely in China.

"That's business we cannot compete with," he said.

Nine people were laid off Monday, Mr. Stout said, and two additional employees requested "a voluntary layoff for personal reasons."

He said Stature also has decided against hiring college students to offset employees' summer vacations, which was the company's prior practice.

The business, which is in the Jefferson County Industrial Park, now has 115 employees.

Laid-off employees will be called back if business rebounds, Mr. Stout said, but he added a note of caution.

"At this point, given what I see in the national economy and how orders are going both with seasonality and the economy, I suggested they look for permanent positions," he said.

He said he believes that Stature is again "stabilized" and is confident the company will continue to employ more than 100 people.

"There's a lot of good people here," he said. "There's a lot of potential, I believe, in terms of sales growth in the coming years."

To offset recent losses, Mr. Stout said, the company is making inroads in developing motors for power-assisted devices that improve a product's ease of use.

"The trend is to have power-assisted mechanisms," he said. "And it's not just wheelchairs and it's not just in the industrial sector where you're starting to see these things."

He concluded: "We've got some good things going and it's just a matter of finding some new markets."

Stature is owned by Allied Motion Technologies Inc., Englewood, Colo.