Unemployment in Girvan could soar by 16 per cent overnight if Nestle go ahead with a plan to axe 20 jobs from its local plant, a report has claimed.
And it is also claimed that the move will only save 2.3 per cent of the company’s costs at the site while causing “devastation” in the local economy.
Now the the GMB union, in a report published on Monday, is calling for Nestle to diversify its product base and its markets in its last remaining Scottish plant.
The company and the unions will now discuss the report at a specially arranged meeting on Friday.
Nestle announced in March that it was to “upgrade and improve” one of its two Girvan plants, but close the other with a loss of 20 out of 65 jobs there.
However, the GMB report; “The Alternative to Downsizing” also deals with the wider economic impact of redundancies on this scale. It calculates that companies involved in the manufacture of dairy products have an employment multiplier of 2.66. In other words the loss of 20 direct Nestle full time jobs in Girvan means that a further 33 full time equivalent jobs will be lost in the jobs market locally.
“With the multiplier effect the number of people on Job Seekers Allowance in the area could soar by 16 per cent. So, to save at the most 1.4 per cent of the Girvan factory’s total costs over 20 people face losing their jobs with the consequential impact on families and the local community. Even with other savings made by closing down a plant in maintenance and depreciation for example the company’s own figures project a saving of just 2.3 per cent of total site costs” the report says.
The hard-hitting GMB report adds, “In every wave of redundancies over the last 20 years the Girvan workforce has been told each time that this one will secure the remaining jobs. It hasn’t. Enough is enough”.
It goes on, ”A look at the Girvan Jobcentre Plus shows that there are nothing in the way of job vacancies comparable to those jobs at risk. Most vacancies locally are elementary - cleaning, personal services and construction jobs. All are at a relatively low grade and rates of pay covering jobs such as bar attendant, labourer or chambermaid.
“Many of them are part-time and some are seasonal. The jobs at risk are permanent and full time. Lives will be turned upside down.
“This proposal by Nestle constitutes a deindustrialisation of the local economy. It is a dent to manufacturing employment in Ayrshire. It would be a body blow to the regeneration of Girvan and to job opportunities for future generations”.
Calling for new investment by Nestle, the report goes on; “Nestle is a major corporation with a wide portfolio of products in the beverage as well as the confectionery market so why couldn’t Girvan benefit from new inward investment by Nestle to meet new markets and new demand in related product fields?”
“This is a corporate downsizing which is not justifiable. Nestle has a corporate social responsibility and by its own measure a duty to create shared value. A business like this has a moral and social responsibility to these workers who by their labours have made money for Nestle for 32 years and to the community in which it is located. We trust that Nestle will face up to those responsibilities”.
GMB Scotland Organiser Richard Leonard said: “Nestlé’s Girvan factory is no lame duck.
“The company posted operating profits of $14.1bn last year, so we simply do not accept the case for making a third of the workforce redundant. That’s why we continue to challenge Nestlé’s plans and are calling on them to set up a Nestle Girvan Alternative Production Centre to progress diversification ideas and so provide security of employment.
“Nestle talks of creating value for society as well as for its shareholders. Here is a chance for them to demonstrate this by keeping these manufacturing jobs in Girvan. In our view it is essential that dairy related manufacturing options which take advantage of location, skills set and technology transfer are actively pursued.
A Nestlé spokesperson said “We continue to have regular dialogue with our employees and their Union representatives on the Nestlé proposal.”