Blue Mountain Lumber management told 56 of its 104 staff they would be finishing work in four weeks, although some have chosen to leave earlier.
The final number of job losses was nine fewer than it had signalled when the restructuring plans were announced on Tuesday.
It means the new-look sawmill will employ 48 staff from the middle of next month.
Twelve workers who took up the offer of voluntary redundancy were included in the total of jobs lost.
Winstone Pulp International, which has owned the Conical Hill sawmill since April 2008, said tough economic times and a lack of orders were two key reasons for the shake-up.
It was either downsize the operation or close down the plant.
Managing director Dave Anderson said at least one manager would go, as well as two senior salaried staff.
Who stayed and who was shed came to down to the specific skills that person could bring to a newly-restructured operation.
"It wasn't necessarily a matter of last on, first off," he said.
The bad news or otherwise was delivered to staff as they arrived at work yesterday morning, in a series of one-on-one meetings behind closed doors.
It is understood staff were then given the rest of the day off.
All staff to go have been given four weeks' notice, although some have said they want to finish immediately or before the April 10 deadline.
The cost of paying out redundancy and annual leave entitlements was expected to be "a seven figure sum", Mr Anderson said.
"There is never a zero cost involved with restructuring."
Extensive business modelling had been done to look at the best ways of running the new streamlined operation, he said.
"Robust discussion" had taken place over which staff members should be retained and which should be lost, he said.
Mr Anderson said the staff staying on were the most skilled and qualified to handle the new-look business model that would take shape over the next month and begin during the middle of April.
While it had been a tough week for the managers who were handling the fate of dozens of staff, Mr Anderson it was nothing compared with how those who had been let go were feeling.
The lay-offs are the second biggest experienced at the plant. In March 2003, the company shed 80 jobs.
The mill employs 23 union-affiliated workers.
National Distribution Union organiser Ken Young, who was on site helping staff yesterday, could not be reached for comment.
Gore District Mayor Tracy Hicks told NZPA workers made redundant from the mill were in a good position to find other jobs, if they had the right attitude.
Mr Hicks said the news was bad for the rural community.
"It's a terrible situation for the community to be in, but I feel more sorry for the people who have lost their jobs today."
However, the workers were was in a good position to regain employment if they were flexible and able to learn a new trade.
The abundance of beef and sheep farms in the area should be able to absorb some of those who were made redundant, he said.
"Work and Income will also be working very closely with those who have lost their jobs," Mr Hicks said.
