700 jobs to go at computer plant

American computer company Compaq is to axe 700 jobs at a Scottish factory as part of a restructuring programme.

The firm plans to outsource the manufacture of consumer and desktop personal computing products which are currently made at its plant at Erskine, Renfrewshire.

The Scottish operation will continue to manufacture made-to-order personal computers, as well as servers.

A spokesman says: "This decision would regrettably lead to a reduction in Compaq's workforce at Erskine of approximately 700 employees, although Compaq remains a major employer in Scotland with more than 2,400 employees."

More than 3,000 staff at Compaq's manufacturing plants at Ayr and Erskine have been waiting since the middle of March to find out whether they will be hit by the firm's decision to slash 7% of its global workforce.

Compaq, which is based in Houston, Texas, is cutting 5,000 full-time jobs among its 67,000 staff worldwide as it bids to reduce annual costs by over £400m.

It has said that its earnings are being hit by increased competition in a weakening US economy.