500 jobs to go as Electrolux closes

Dec 15 2007 by Neil McKay, The Journal

THE worst fears of workers were confirmed yesterday when they were told their factory was to close.

The Electrolux plant in Spennymoor, County Durham, which makes cookers, will close towards the end of 2008 and production will shift to Swidnica in Poland, with the loss of 500 jobs in the region.

The news was greeted with anger in the town of 20,000 residents, coming as it did on the back of closures of major employers like Black and Decker, Rothmans and Courtaulds.

Jeff Moreland, from the trade union Unite, called it “the worst possible Christmas present for Spennymoor”.

He added: “This plant has been open here since 1947 and I doubt whether moving to Poland is the correct decision economically.

“This is another shameless example of British workers being dumped in favour of low-wage exploitation in Poland. There had been no political will to keep manufacturing in the UK and save British manufacturing. The company’s decision to move production to Poland, where workers are paid a quarter of a British wage, will not be profitable in the short run.”

And local MP Helen Goodman said: “This news is extremely regrettable for all the people who worked in the Spennymoor factory.

“I was particularly surprised by this decision, as I opened a new production line at this factory only two-and-a-half years ago, and I know how much effort has gone into trying to make this a success.”

But Magnus Yngen, head of Electrolux Major Appliances Europe, said: “Our competitors have, to a large extent, moved their production facilities to countries with a lower cost-base which has resulted in increasing price pressure.

“This development, in combination with a shift in customer preferences from free-standing cookers to built-in cookers, has eroded the competitiveness of our Spennymoor factory.”

A proposal put forward by Unite and local management to retain some production and save 300 jobs was rejected by the company in favour of moving the entire site abroad.

Mr Moreland pointed out: “The company will have to pay back £1.4m in grants to the Government plus huge redundancy costs. Electrolux will still be servicing the UK market by hauling the cookers across Europe and shipping them across the North Sea.”

Workers were told the news at 8am yesterday. General manager Dave Watroba said: “There is never a good time to make an announcement like this. I think the workforce would prefer to know before Christmas rather than have the uncertainty hovering over them during the holiday period.”

Mr Watroba said 50 of the workers would be laid off in January, a further 170 in July and the rest in November.

He added: “Some workers in their fifties who have been with us for 30 years or more will no doubt welcome the redundancy and access to the company pension scheme. But we have around 100 who have been with us for no more than two years and we will be looking to offer retention packages for them until the factory ceases production, and also help them find decent new jobs.”

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Workers upset at grim news

WORKERS were close to tears as they left the 50-year-old plant within just over an hour of being told it was closing yesterday.

Management decided to give the workforce the rest of yesterday off after dropping the bombshell.

Doug Banks, a union convenor at the plant, said: "It is a sad day for Spennymoor. I have worked here for 35 years. I feel sorry for the workforce, especially the younger ones. Local jobs are just going to disappear.

"An awful lot of jobs depend on Electrolux, both directly and indirectly."

Derek Wilson, 53, of Dickens Street, Spennymoor, said: "At my age, and having worked here for over 30 years, it is going to be hard to adapt to changes.

"For this announcement to come at Christmas is a really bad time."

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Staff are promised help to find work

REGENERATION agency One NorthEast pledged yesterday to help Electrolux workers find new employment.

In an attempt to sound upbeat, Ian Williams, Director of Business and Industry, said: "Previous experience of major job losses like this shows that 80% of the workforce finds new employment within six months.

"We will now be working with our partners and Electrolux senior management at Spennymoor to give the workforce every possible opportunity to find new employment.

"A public and private sector response group comprising employment and skills experts will work with every employee to identify their strengths and the opportunities open to them moving forward."

Mr Williams insisted that "manufacturing was not dead" in the North-East.

"Although some form of manufacturing, such as the type Electrolux supply, is cheaper to move abroad, and the economy is changing all the time, 15% of all North-East jobs are still in manufacturing," he stressed.

But Stephen Hughes, Labour MEP for the North-East, said: "Electrolux has today shown – like so many other companies currently – that it is guilty of extreme short-termism. It is willing to walk away from a skilled, well-trained, adaptable and reliable workforce.

"During the review, workers came up with scores of excellent ideas to cut costs and boost productivity. It will take years to build up that sort of co-operation in Poland, if at all."