Re-training package for Longbridge workers may be optimistic

Apr 28 2005 by Nic Paton Print This Article

Optimistic predictions that the workers laid off at Longbridge will be snapped up by other industries in short order may be wide of the mark, a study has suggested.

The Government's £150 million aid package for the stricken MG Rover car manufacturer and its 5,000 workers may not be enough, the Work Foundation has warned.

The level of re-training required to get Longbridge workers back to work will require far greater resources than have currently been earmarked, it predicted.

The foundation's Professor Marc Cowling said: "An organisational failure of this scale coupled with the particularities of the local economy means high levels of investment in training to correct a local market failure is the right policy decision to have taken."

But, with dealer and supply chain redundancies added in, and even with additional European funds being made available, the extra cash for training could amount to as little as £5,000 per redundant worker.

In order to maintain parity of income and future labour market security, training up to NVQ level 3 Ė the equivalent of A-level Ė or beyond is almost certainly needed, it argued.

The level of funding for training as opposed to other priorities therefore needs to be urgently examined.

The labour situation in the local area may also make finding work tricky. The Longbridge area already had a relatively high proportion of unemployed workers who were not actively seeking employment.

Self-employment rates at 4.8 per cent were barely half the national average and declining, and the actual local unemployment rate (of 4.3 per cent) was higher than the national average by just under 2 per cent, said the foundation.

Job growth for male full-time workers was also negligible in the region, it added.

Absorption rates into new jobs will be relatively slow, and will be in other, relatively low skilled sectors where wages are comparatively low, it predicted.

"It is almost certain that most Longbridge car workers will only find employment opportunities outside their immediate area," said Professor Cowling.

"If such job opportunities are low skilled and low paid the disincentive effects on such travelling could be considerable," he added.