Factories blame credit crunch for axing 239 jobs

Almost 250 jobs were lost today as factories in Galway, Kilkenny and Limerick cut their workforce.

Bosses at the three separate manufacturing plants blamed the worldwide credit crunch and foreign exchange rates for the massive redundancies.

Thermo King in Galway laid off 110 workers, while NN Euroball in Kilkenny slashed 70 jobs, and Limerick’s Filtertek plant cut 59 posts.

Labour’s Willie Penrose said the losses were the latest in a relentless series of bad news stories to hit Irish businesses and their workers.

He called on the Tánaiste and Employment Minister Mary Coughlan to identify issues that industries face and put together a plan of action that will enable companies to ride out the current storm.

“My thoughts first and foremost are with those people who have today leaned that their jobs are to go, and with Christmas just a few weeks away, the news could hardly have come at a worse time,” said Mr Penrose.

Ray Pittard, of climate control technologies plant Thermo King, said the speed and impact of the economic slowdown combined with the decline of the Euro against the US Dollar was unprecedented.

“Such events demand a response and the realignment of our people and resources,” he said.

Mr Pittard revealed the firm would downsize operations by suspending contracts, offering voluntary severance, and non-renewal of temporary contracts.

“We regret the necessity to propose the planned measures, but we are convinced that these measures are essential to position the company for the future,” he added.

NN Euroball said production will cease at its Kilkenny facility, which produces precision steel bearing balls, by early February.

The firm said it fully appreciated the impact of the move on employees, their families and the wider community of Kilkenny, but stressed the decision was part of its long term strategy to rationalise its European operations.

“We are committed to funding a financial package for those employees affected by the closure and providing resources for financial and pension advice as well as working with various state agencies to ensure that our employees stand the best prospect of securing alternative employment,” added NN Ireland MD John Crowley.

“We will support any initiatives to find an alternative business to operate from the facility we will vacate.”

Meanwhile, management at Filtertek BV announced it was reducing its workforce from 99 to 40 people.

“Recent economic factors have affected the ability of the company to provide cost competitive products to some of its major European and North American based customers,” said the firm, which makes components for the healthcare and commercial markets.

“The company regrets having to reduce the size of its workforce but is confident that this action will strengthen its financial and strategic position and give it a solid foundation on which profitable growth can be built in future.”

Mr Penrose claimed small and medium sized enterprises were being forced to close because banks would not extend credit.

“Minister Coughlan may argue that the slowdown in production is part a worldwide problem which is out of their control,” he said.

“While there may be an element of truth in that, it shouldn’t be an excuse to let the Government off the hook with regard to those elements of the economic equation that they do control.”

He said that despite a government bailout, small business cannot secure finance and cash flow has become a major problem.

“What is at issue here is the survival of hundreds of businesses and possibly tens of thousands of jobs,” he added.