Last week, two well-established companies in Shannon announced 207 job cuts. Owen Ryan reports.
THURSDAY of last week was a black day for employment in Clare with two Shannon companies announcing the cumulative axing of 207 positions.
Shannon Aerospace staff were told the company intends to make 107 workers redundant, while staff at Elsevier, a publishing company, were told that 100 of 108 positions are to be made redundant in the next few years.
Both are long-established companies in Shannon, with Aerospace, which is a subsidiary of Lufthansa Technik AG, being founded in 1989 and Elsevier present for over 30 years.
At Shannon Aerospace, three members of senior management, 20 lower-level members of management, 20 production technicians and 64 of those working in administration and support (including logistics, engineering, planning and HR), are all to go.
Managing director, Thomas Ruckert said it was the most difficult day of the company’s history but claimed the move was necessary to protect the remaining jobs.
“We announced our restructuring plan for the future of this company to secure more than 500 jobs here. Part of that, unfortunately, was the announcement of 107 redundancies. We will try to make them voluntary, as much as we can but we have to see if we get enough volunteers.”
While he said it was tough news for the employees to absorb, they would have been aware of poor levels of business. “It didn’t come as a surprise I would assume because they have seen the hangar not being as full as it should have been in the last few months.”
He claimed the company has been losing business to companies that are offering prices of 25-30% below theirs. He added that while the company are likely to lose money this year, things have been getting a lot worse in the last few months.
“We will make a loss of €860,000 this year but the forecast is much bleaker if we continue as we are, because the problem really has happened in the last few months, it has really accelerated.”
This year, the company isset to sell in the region of 600 to 700 thousand man-hours, he commented, which is down around 20% on last year, with the amount still dipping as the year goes on.
He claimed that cutbacks have the potential to revitalise the company and leave it in a very positive position going forward. “I think with our plan, we will be able to deliver products here which people will be buying. I’m not worried about it [the future of the company] if we implement the plan.”
He said he would like all discussions on the redundancies to be complete by Christmas.
Elsevier is to make around 100 positions redundant from 108 staff over a two-and-a-half-year period, commencing next April.
The company is a publisher of scientific, technical and medical information products and services. It has had a base in Shannon for over 30 years and is apparently still recording significant profits.
Managing director Brendan Curtin said it was a difficult piece of news to have to break. “We have arrived at this difficult proposal after an extensive and exhaustive review of many options. We understand the disruptions this proposal may cause in personal lives and in our community. We will now enter a period of consultation with our colleagues and their Employee Consultation Forum. Over the following weeks, we will continue to ensure that our employees remain well informed on the process and that they receive the support they need and deserve.”
He said the work done in Shannon would now go to other sites. “Cost is a factor in any business but a bigger factor is our global policy of consolidating into some of our bigger locations. Some of the work is going to the UK and Amsterdam. Cost is always a factor but in this case, there were a number of other factors.”
Mr Curtin spoke to the media outside the front of Elsevier and afterwards walked back towards the doors to the applause of staff from upstairs windows.
Clearly staff were taking the news reasonably well and he said he had been somewhat surprised. “For me, it was a very difficult message. I’d be extremely proud of our staff. There was a lot of emotion there obviously but I was kind of surprised, it went better in a way than I had expected.”
Workers at both companies were understandably reluctant to comment but one employee at Shannon Aerospace said it is worrying for him. “I’m engaged, mortgage, the whole works,” he said.
He said he would try and stay with the company. “Oh definitely, they’re a good employer and I did all the training here.”
He said he wasn’t particularly surprised that cutbacks are being made, given the level of business at the company.
Another Aerospace employee said he was concerned that there could be further cutbacks announced in the future, given the level of business.
Support needed for employees facing redundancy
WHILE Clare Fianna Fáil TD Timmy Dooley said the loss of jobs at Shannon was grave news, he said the focus has to be put on preserving as many positions as possible.
“It’s devastating news that these job losses have been announced. It’s a real blow to everyone involved with Shannon Aerospace and Elsevier and to the whole of the region. These are very difficult times and the impact that these job losses will have on the families involved can’t be underestimated. I will certainly be seeking some form of support for the employees who are ultimately asked to take redundancy.
“We must turn our attention to safeguarding the future of as many jobs as possible. During a briefing with the managing director of Shannon Aerospace, I was assured that the restructuring plan will protect 500 jobs and the future of the company. This would still see 107 job losses, but the majority of the jobs will be saved.”
He said he also sought a meeting with management at Elsevier. “This was a very, very disappointing announcement, considering the many years of loyal service that has been provided by their employees and the great history they had in the region. They will be sorely missed.”
Deputy Dooley said the Mid-West needs to be given priority when it comes to attracting investment. “The IDA and Enterprise Ireland should be instructed to make every effort to find replacement jobs and to step up their efforts when it comes to attracting employers and investment to the Shannon Region.”
Speaking last Thursday, Defence Minister Tony Killeen also said that Shannon needs to be prioritised. “I have asked Minister for Enterprise Batt O’Keeffe to ensure that Shannon and the Mid-West Region feature prominently when he leads an enterprise agency delegation to the US this weekend to attract investment and jobs. I have impressed on the enterprise minister that the Shannon Free Zone, which has long been an established centre for investment and innovation, will be the location of investment by other firms in the near future and that alternative employment can be sourced for those affected by today’s announcements.
“IDA Ireland, the agency responsible for the development of Foreign Direct Investment in Ireland, always has companies in the pipeline seeking to take advantage of a readily available and highly trained workforce. Every effort must be made at local and national level to ensure that Shannon Free Zone maintains its position as the location of choice for global businesses across a variety of industries.”
Fine Gael Deputy Joe Carey said the Government needs to deal with the employment situation in the region. “What is needed now is targeted government action in the Mid-West. While the recommendations of the Mid-West Taskforce Report gather dust, the economic crisis in this region worsens. Government must now step in and declare the Mid-West Region an employment priority. I am calling on the Minister for Enterprise, Trade and Employment to leave his comfortable office in Dublin and visit this region immediately. He must engage with both Shannon Aerospace and Elsevier and save as many jobs as is possible.”
Party colleague Deputy Pat Breen said, “Unemployment in this county has soared by 70.62% over the past two years and there are now almost 11,000 signing on the Live Register. In spite of these figures, we have seen little or no action from Central Government. The recommendations of the Mid-West Task Force report continues to sit and gather dust in the Tánaiste’s office and with unemployment expected to rise to an average of 13.75% next year, without a jobs stimulus package, this Government’s spending cuts will kill off any chance of an end to the recession this year.”
Meanwhile, Shannon Development said it is disappointed with the job losses at both companies. “Our thoughts are with the people affected and their families. Shannon Aerospace and Elsevier are both well-respected companies and have been good employers at Shannon Free Zone over the years – 20 years in the case of Shannon Aerospace, and 34 years in the case of Elsevier.
“Shannon Development will continue to work with the local management and parent companies in an effort to minimise the impact and identify new higher value-added activity.”
Mary O’Donnell of SIPTU said workers at Aerospace had been left reeling. “Our members are shocked at the proposed job losses and we will engage with management in serious discussions, both on the future of those who are to lose their jobs and on the restructuring plans of the company,” she commented.
Mayor of Shannon Tony Mulcahy said the Government needs to take a hand. “The Shannon industrial heartland was developed by the entrepreneurial spirit of the late Brendan O’Regan who opened up the Shannon area to tourism, industrial development and job creation. This spirit has been crushed by the inaction of regional development agencies and the Government.
“The workforce in this region has time and time again reinvented itself to adapt to changes within the manufacturing, industrial and services sectors. However, the current haemorrhaging of business and confidence in the region, coupled with wholly inadequate support from regional and Government agencies, is making it very difficult for any recovery to take place in the short term,” he said.