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1 November 2007 Edition

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New approach to job creation urgently needed

More than 900 workers will lose their jobs in Limavady, County Derry when the Seagate plant closes in a matter of months. The company has decided to move production of disk-drive components from the North of Ireland to Malaysia citing labour costs as the main reason.
The Seagate closure has come as a severe blow to the North West. With employees from counties Derry, Antrim, Tyrone and Donegal working at the plant the effect will be felt across the entire region.  
The development is the latest example of the downsides of globalisation and demonstrates the vulnerability of industries at the lower end of the wage spectrum to competition from lower wage economies in the middle east and elsewhere.
Enterprise agencies must not simply focus on the creation of jobs – a key issue is the type and quality of jobs which are created.  The future lies in the creation of better paid, higher skills jobs and the development of research and development capacity within enterprises based in Ireland.  Improving transport and communications infrastructure is crucial if this is to be achieved.
In the past when it was evident that an industry was under decline – such as in the case of textile manufacturing in Donegal – the Irish Government failed to make early interventions to ensure the creation of alternative employment. This cannot be allowed to happen again, either in the case of the remaining low skill manufacturing jobs or in the case of the over-inflated construction sector within the 26 counties, which is predicted to lose around 25,000 jobs by the end of the year.
In the 26 Counties, the loss of manufacturing jobs in regional towns over recent years has been camouflaged by a buoyant construction sector and the government has not addressed the underlying weaknesses in the economy. The contraction of the construction sector puts additional urgency on the need to focus on creating jobs that will be sustainable in the longer term.
Sinn Féin has made the need to create new jobs in regional towns that have lost manufacturing jobs over the last decade a key campaigning issue. The party will focus on measures needed to ensure the creation of such jobs: upskilling and retraining of workers, improving transport and communications infrastructure and a joined up approach between the enterprise development agencies North and South. The party is campaigning for an increased focus on the development of indigenous enterprise.
In March 1998 not long after it opened its plant at Limavady, Seagate closed its plant in Clonmel, County Tipperary with the loss of 1,400 jobs. The lesson from both Clonmel and Limavady is that over reliance on a single enterprise can have devastating consequences for a town if that plant closes.
The other lesson is that it is inevitable that multinational companies like Seagate will move this type of manufacturing operation to jurisdictions which have lower labour costs. Clearly Ireland, North nor South, cannot hope to compete based on low wages.

An Phoblacht
44 Parnell Sq.
Dublin 1

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