Press Report : Human toll of MG Rover closure revealed in report
Jon Griffin, Birmingham Post, 9th July, 2009
Many MG Rover workers hit by the closure of Longbridge had no idea how to write a CV or behave at a job interview, a new report reveals. The report, drawn up by academics from institutions including the University of Birmingham and Birmingham Business School, reveals the human toll of the closure of the car firm in April 2005.
More than 200 former MG Rover workers were interviewed for research funded by the Economic and Social Research Council, with the report’s compilers including David Bailey of Coventry University Business School and Caroline Chapain of Birmingham Business School.
The report says: “It needs to be borne in mind just how calamitous the sudden redundancies of 6,000 people could have been for the region. A majority of workers reported facing difficulty in finding employment, especially due to the number of people applying for the same job, age and lack of skills. Indeed, most workers had to convert to service sector work and were using different skills in 2008.
“The need for workers to change their type of job and/or occupation to find employment resulted in significant pay cuts, with average pay falling by £5,640 per year in real terms. Two-thirds of workers suffered wage falls while a third reported an increase in their salaries.
The need for workers to change their type of job and/or occupation to find employment resulted in significant pay cuts, with average pay falling by £5,640 per year in real terms. Two-thirds of workers suffered wage falls while a third reported an increase in their salaries.” Economic and Social Research Council Report
“The jobs at Rover were high-quality manufacturing jobs paying above the average for the West Midlands region so it was always likely that workers would not be able to find directly comparable work. Overall, the 31 per cent of workers who stayed within the manufacturing sector earned similar amounts of money but the 60 per cent who moved into the service sector were mostly earning less.People who found work in four sectors – wholesale and retail, real estate and business services, education and health and social work – took average cuts of more than £6,000 in annual income.”
The report reveals that nearly a quarter of workers surveyed were in debt or dipping into savings while 36 per cent said they were “just about able” to manage on their incomes. “Judged against national levels, it does appear that the ex-Rover workers moved into jobs with lower levels of autonomy, challenge and skill use, and fewer opportunities for progression than other workers in the UK.
“It is important to note that many workers had worked at Rover for a very long time, some even all their life, and the closure came as a real shock. Our interviews indicate that while some were ready to move on almost immediately, others needed more time to adjust. Many had never been unemployed. They did not know how to write a CV or how to behave during a job interview.
“A majority found the experience of going to the Job Centre very difficult. Many reported high levels of stress and anxiety during the first year after the closure. Support from family, friends and ex-colleagues was critical – in fact, 70 per cent of workers reported finding their current job through personal networks or initiative.”
The report calls for “a more tailored approach to workers’ needs and resources.” “While there was a speedy response to the crisis, there is a need to be more sensitive to people who have never been unemployed and do not know how to make benefits claims, and a need to help people feel that it is not their fault that they have become unemployed. There is also a need to offer counselling to help people cope with redundancy, especially those experiencing depression and ill-health as a result.”
The research showed that workers made redundant tended “to experience more precarious employment pathways afterwards. While our overall findings show that most workers were back into work in 2008, 11 per cent were still not in employment at that time. In addition, MG Rover’s demise meant a shift away from secure jobs in traditional sectors to more insecure lower-paid jobs. For example, a third of those employed in 2008 reported having had at least another job since the closure.”
While our overall findings show that most workers were back into work in 2008, 11 per cent were still not in employment at that time. In addition, MG Rover’s demise meant a shift away from secure jobs in traditional sectors to more insecure lower-paid jobs. For example, a third of those employed in 2008 reported having had at least another job since the closure.” Economic and Social Research Council Report
The report concludes that rapid action by local agencies over the MG Rover crisis could be viewed as a “success story” with large-scale, long-term unemployment in south Birmingham and the wider West Midlands avoided. “However, longer term, workers face a precarious situation and the need for policies to create and sustain “good quality” jobs remains paramount.
“It is crucial to consider the ripple effects of redundancies and closures on the communities where these workers live, and to implement locally and regionally co-ordinated support, taking into account the capacity of these communities to respond to economic shocks.”
In the wake of the collapse of LDV, the latest blow to West Midland manufacturing, a new Work Force has been set up to help displaced employees, the report points out. “It is vital that a ‘permanent capacity’ is created in order for policymakers to address large-scale redundancies as the recession unfolds,” the authors say.
The report’s authors add: “Making sure that individuals’ capacities and resources to deal with redundancy are taken into account and addressed will also be crucial in helping ex-LDV and other workers in finding new jobs. In addition, Government and agencies should ensure that employees have the necessary skills to cope as industries change. This is especially important during the downturn, where finding any job, let alone ‘quality jobs’. will be more difficult.”
[Source: Birmingham Post]