Job losses: ‘It’s going to hit everyone in the community really hard’

Job losses: ‘It’s going to hit everyone in the community really hard’

By Joe Leogue

“Like all the factories down through the years, Fords,Dunlops, they’ve all done the same thing. You know, just a wipe of the pen. “It’s just not going to work. We can do it cheaper somewhere else”.”

Joe Barry was one of a very few who stopped in the cold to speak to the media outside Novartis in Ringaskiddy yesterday morning. With the news that Novartis is to lay off 320 workers —including 240 in the Active Pharmaceutical Ingredients (API) plant in which he works — Joe was still coming to terms with the announcement.

His demeanour was of a man that was somehow both resigned to fate, yet optimistic — he had accepted the announcement, and yet hopes that the long restructuring period may see plans changed.

“It’s kind of a global thing I suppose really. It’s the way the API pharmaceutical companies are going. It’s smaller volume, contracted out, because they say it’s cheaper.

“As you’d expect, most people are worried. There are a lot of fellas in there 25, 30 years. So we’ll see what way it pans out. It could change, I’m there a long time as well, it could change. You know, like, these things can change. I don’t hold out much hope, but it could change.

“We knew things were coming down the line, we knew things were changing in there but they had invested a lot of money in there as well. So we were kind of hoping, but again I’d never say die,” he said.

Fianna Fáil councillor Seamus McGrath said the news comes as a warning that policymakers cannot afford to be complacent, and need to understand why these jobs were lost.

“It’s an absolutely devastating blow. It’s a significant number of job losses,” he said.

It’s a huge number of job losses and I know there’s still a lot of uncertainty in terms of when the job losses will kick in and so on like that. I think it’s important that the authorities engage fully with the company to try and get to the bottom of this decision, what were the reasons? Why was Cork chosen? It’s a long-standing company here, it’s in the area a significant period of time.

“There is no question there will be varying impacts on households, but certainly some households will be hit very hard if you have more than one person employed.

“But, you know,notwithstanding that I think even one person to be unemployed in a household will result in a significant impact and that’s why every response possible at an authority level and government level has to be made in this instance,”Mr McGrath said.

Local woman Amanda Forde works in the nearby Perry Street Cafe. She said the workers in Novartis were great supporters of the business.

“We all have to rally around them, and coming up to Christmas it’s going to be tough on them,” she said. "There’s going to be a lot of people, with a lot of friends and family working up there. So it’s going to hit everyone in the community really hard. There are generations up there, normally people will follow their family into a factory."

Sarah O’Grady, owner of the nearby Ferrybank Inn, said the demographics at Novartis changed over the years, and that those working at the plant now come from across Cork, whereas decades ago, staff were predominantly from the village.

Despite this, the local reaction was still one of sadness.

“We’d have a lot of lunches that they would ring in and pre-order for anyone that was leaving or coming back or for maternity leave, we’d have a lot of parties for that,” she said. “It’s a shock to everyone down here.”

Back at Novartis, as he left work for home, Joe retained his optimism.

“There’s a lot of companies around the place and there’s a lot of people taking on. I think we’ve quite an older demographic but I’d say you’d be hopeful that you’d pick up something. I personally think that there might be a chance that something would happen, you could have a corporate change in policy. That’s probably just trying to look on the bright side, really.”

Hard pill to swallow for staff as bombshell comes despite earnings

By Eoin English

It’s been making medicines in Ireland for decades but the timing and scale of job losses announced by pharmaceutical giant Novartis in Cork yesterday was a very bitter pill to swallow. The 530 staff based on its Ringaskiddy campus have known for some time the company, which posted over $7bn in profit last year, was undertaking a global review of operations.

But the bombshell that 320 jobs — more than half the workforce at Ringaskiddy — are to go over the next three years sent shockwaves through the site, through its Irish operation, and through the wider pharma and life sciences sector which employs some 30,000 people nationally, almost half of those in Cork.

It’s one of the single largest job loss announcements in the region in recent years. Novartis’s Dublin operation, which employs 660 people, is not affected by the decision. Less than 24 hours earlier, the firm boosted its earnings forecast and revealed sales of its medicines, such as psoriasis drug Cosentyx and gene therapy Zolgensma — hailed as the world’s most expensive drug at some $2.1m per patient — had surpassed expectations for Q3.

Novartis is one of the world’s top biopharmaceutical firms and among several of the global leaders based in Ringaskiddy, once home to heavy industry but which has, over the last three decades, become the beating heart of Ireland’s pharma and life sciences hub.

Headquartered in Basel, Switzerland, Novartis was one of the first pharmaceutical companies to locate here. Today, it employs around 1,100 people across three Irish operations — a manufacturing plant and a business service support centre on its large Ringaskiddy campus, and a global service centre in Dublin.

Yesterday’s announcement affects Ringaskiddy only, the company stressed, with the 320 redundancies to be spread across the two on-campus operations — 240 jobs to be shed from the manufacturing plant and 80 from the business support centre over the next three years.

According to company figures, the number of people employed across the site will go from 530 to 220 by 2022. It is understood that in 2016, Novartis launched a global review of operations across its estimated 60 sites around the world, and just like the others, the Ringaskiddy campus came under the microscope.

The manufacturing plant is run by Novartis Ringaskiddy Ltd, which was established in 1989, to make the active ingredients for respiratory, cardiovascular and transplantation medicines. It employs 350 permanent staff. It has quality control laboratories and some warehousing and a range of ancillary elements to support the manufacturing process.

It’s estimated the company has invested €900m in the development and transformation of the manufacturing plant over the last three decades, adapting in response to various market and medicinal trends.

But despite the adaptations in recent years to what industry sources describe as a “small to medium volume new product launch site”, the expiration of patents on two key drugs which were made on-site led to the company taking the view that the volume of production or activity on site was just too small to sustain the level of employment. Manufacturing will relocate to contract sites.

The global service or supply chain centre run by Novartis International, was established in 1996 and employs 180 people. It provides support services for Novartis manufacturing sites globally in areas including production planning, supply chain management and centralised lab testing. These jobs will move to other sites in Europe and Asia.

The Dublin site, established in 2013, employs 660 people who work in several areas, including HR, IT, marketing, for the group on a global scale. This centre has also forged links with third level institutions for collaborations in areas such as healthcare data and economics. It has escaped the axe. Union sources said there had been talk in recent weeks of a possible sale of the Ringaskiddy manufacturing plant.

While the IDA has not commented in detail on its engagement with the company over the last year or so, it is understood it was working with Novartis management on alternatives to job cuts, and this may have included attempts to identify potential outside investors. But obviously, those efforts proved unsuccessful and the news was relayed to staff yesterday.

The only good news was that the job losses are not immediate, and will be phased in from next year. Politicians, including Tanaiste Simon Coveney and Fianna Fáil leader, Micheál Martin, in whose constituency the company is based, various state agencies and business leaders all expressed concern for the affected staff and pledged to do what they can to minimise job losses and source alternative work.

Whether it’s a Brexit early warning sign, or just another example of the ebb and flow of multinational pharmaceuticals, remains to seen.

Business Minister: No more imminent job cuts

By Gordon Deegan

Business Minister Heather Humphreys said she has received no briefings from the job development agencies here of any further large scale imminent job losses. Speaking in the Shannon Free Zone, Ms Humphreys said she is not aware of any other job losses pending.

She was commenting in the wake of a double jobs blow in the space of 24 hours that claimed a total of 820 jobs at Molex in Shannon and Novartis in Ringaskiddy, Co Cork.

“This is a bad day for Munster — there is no doubt about that. Two jobs losses which is disappointing but nevertheless there are many job opportunities in this area,” she said.

Ms Humphreys said she is confident new jobs will be found for the people affected. The jobs loss at Molex is the largest single jobs loss to hit the mid-west since the closure of Dell more than a decade ago. The closure will result in the loss of annual salaries of €22.9m to the local economy from the 500 jobs.

Molex workers approached for comment outside the plant yesterday declined to comment on the shock closure of the facility that is scheduled to take place in 2020. At the Enterprise Ireland offices at Westpark, Shannon, Ms Humphreys met with a number of stakeholders including the IDA, Enterprise Ireland, the Shannon Group, the Department of Social Protection and third-level colleges in the mid-west.

She said a core group from the regional enterprise plan committee will co-ordinate the response to the job losses in Shannon and a skills audit is to be carried out of the Molex workforce. She also confirmed a jobs fair will be staged to see what other jobs are available in the region.

There are jobs available in this locality. It was said in the room that this has happened at a much better time than 10 years ago when there was huge unemployment, said Ms Humphreys, adding that the unemployment rate was 16% ten years ago compared to 5.2% today.

“I am absolutely convinced that there is a great future for this area.”

Ms Humphreys said she had no plans to meet with the Molex workers. “I have to be very conscious that this is a very difficult and very emotional day for the workers and I’m sure the last thing they want to see is the Minister for Business coming to see them.”

She said she wasn’t aware the US-China trade war was a factor in the closure of Molex.

Fianna Fáil TD Timmy Dooley was one of a number of elected representatives to attend the meeting. “It was a focused, sharp, business-like meeting, and the people there were good people from the various agencies who are very focused on getting new jobs for the people affected and getting a replacement industry into Shannon.”

Varadkar’s ‘deep regret’ at Molex and Novartis losses

By Daniel McConnell

Taoiseach Leo Varadkar has expressed his “deep regret” at the double announcement of job losses in Cork and Shannon, but said they are not linked and part of a wider problem. Mr Varadkar was responding to questions from Labour leader Brendan Howlin who sought answers on government aid.

Mr Howlin reflected the surprise expressed by many that Business Minister Heather Humphreys did not have any idea the job loss announcements were coming. He criticised the lack of knowledge in the Government given the Novartis review of its global operations has been ongoing for over a year.

In response, Mr Varadkar said sometimes companies don’t give advance notice of their plans. Mr Varadkar said those who will lose their jobs will be entitled to a range of benefits from the State including jobseekers’ benefit and funds to enable them to retrain. The Taoiseach said Ms Humphreys cancelled events to travel to Shannon to meet people in a bid to organise aid.

Mr Howlin said he was concerned that the job losses appear to have come completely out of the blue for the Government and IDA, especially in relation to the jobs at Molex.

In less than 48 hours we’ve had two significant job loss announcements in Cork and Shannon with news of the pending closures of Novartis and Molex Ireland.

“These are not just 820 jobs; these are the livelihoods of 820 people and their families who are now left with serious worry and stress in the run up to Christmas. We need to see increased efforts from the relevant minister to attract new business opportunities to the south-west region.”

Ms Humphreys said she had no notice of the losses.

“We are in close touch with all the [multinational] companies all of the time. But sometimes decisions are made in board rooms not in Ireland and these decisions have an impact on Ireland and on the jobs here. Ultimately this is a decision for the company.

“The reality is Ireland is a very open export-orientated economy, and we are operating in an intensely competitive global market and this can sometimes mean that decisions taken by firms abroad can sometimes impact on their operations here.”

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