Job losses due to restructuring, not relocation: study

FOUR out of every five jobs lost over the past 18 months have been due to company restructuring and not to relocating to countries with cheaper labour costs, according to the EU agency for working and living.

But most countries, and Ireland in particular, are not spending enough on retraining workers to ensure they are re-employed quickly.

The findings released in Brussels yesterday call into question the proposed multi-billion euro globalisation fund proposed at a summit of EU leaders in London last month.

Willy Buschak, acting director of the Dublin-based EU Foundation, said of the findings: “Internal restructuring accounts for 80% of job losses which shows that most job losses have nothing to do with China being cheaper.”

He said the focus in Europe, where some countries have an 11% unemployment rate, should be on re-qualifying the work force and increasing skill levels.

Ireland is particularly bad when it comes to this despite the existence of social partnership and has one of the lowest spends on worker training.

The extensive survey carried out by the Foundation for the Improvement of Living and Working Conditions shows that little or nothing is known about restructuring by companies and its effects.

In some instances where workers are laid off, it is because they have become so productive that fewer are needed, while in other cases they are producing goods that are no longer needed, said Mr Buschak.