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One ray of sunshine on dark day for jobs

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Rishi Sunak

Rishi Sunak

PA

Rishi Sunak

The potential loss of 700 jobs at Caterpillar - almost half of its Northern Ireland workforce - is yet another severe blow to the manufacturing base in the province. The irony is that the jobs are going to India, a low cost economy, the same reason which made the province an attractive inward investment destination in past times.

If the job losses at its Larne plant go ahead as planned over the next 18 months it means that Co Antrim will have lost around 3,000 well-paid manufacturing jobs since 2012 following the closure of the former Gallaher's tobacco factory, Michelin tyre company, and Wrightbus bus builders.

The collapse of construction firm Pattons added to the misery.

For it is not just those who lose their jobs who will be affected, but also their families and the company's supply chain and traders in Larne will see a huge drop in their income.

Caterpillar's decision has been taken as part of a global restructuring measure which means that any discussion with local politicians on mitigating the job losses is unlikely be bear any positive results.

The announcement by grocers Sainsbury's that it wants to shed 3,500 jobs after recording a pre-tax loss of £137m in the last year is likely to mean more bad news for the local economy. The company plans to close some of its Argos stores although it is uncertain how the 13 based in Northern Ireland will be affected. The province is unlikely to escape some of the pain.

The one quite large ray of sunshine on the economic front came from the Chancellor yesterday when he announced that the furlough scheme will be extended until March next year. It may go against the grain of a dyed-in-the-wool Tory Chancellor to spend on this scale - around £5bn a month for the whole of the UK - but ultimately he has few options in his efforts to keep the economy ticking over or, at least, in suspended animation.

With unemployment already at record levels the furlough scheme will at least stop more workers joining the dole queue and the Chancellor's hope - shared by everyone - is that by next March health authorities will have begun to roll out an effective vaccine against Covid-19.

Quite how the billions of pounds already spent in propping up the economic will be repaid has not been spelled out, but the obvious answer would seem to be through higher taxes.

Whether the economy can bounce back to a position where higher taxes are viable or acceptable is an imponderable question at this time of world-wide uncertainty.

Belfast Telegraph


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