Economic crisis - Saving jobs has to be our priority

THE welcome news that a reduction in oil prices and cheaper mortgages cut inflation to its lowest rate in almost 11 years last month is inevitably overshadowed by worrying news that nearly 2,000 more jobs may be lost in Munster in the coming days or weeks.

It was further overshadowed by deteriorating news last night concerning 1,200 jobs at the Dell call centre in Cherrywood, Dublin.

The Dell closure in Limerick is sending waves through the local economy and, just days after Dell axed 1,900 jobs, 400 workers at the nearby RR Donnelly plant — formerly Banta Global Turnkey — are expected to lose their jobs too. SIPTU confirmed yesterday that workers had been informed by management of the company’s impending closure. The operation is entirely dependent on business from Dell.

These worries are multiplied across the region with scores of smaller enterprises facing similarly bleak, though not so visible, prospects on foot of the Dell tragedy.

Further south, car component manufacturer Kostel has flagged cutbacks at its plants in Abbeyfeale, Co Limerick, and Mallow, Co Cork, where around 1,000 people are employed. Though bad news is expected, there remains a reasonable hope that workers are facing cutbacks rather than a closure or closures.

Workers have been asked to a meeting early this morning but whether Kostel can weather the collapse in the industry remains to be seen. New car sales are down by 75% since this time last year and the future of European manufacturers, the GM-owned Saab and the Ford-owned Volvo, are uncertain. A German company, Kostal have been admirable employers for some decades and made significant contributions to their communities. Workers were on short-time before Christmas and only returned to work this week.

It is little or no consolation to those who have lost jobs but the news on inflation will make the deferral of pay rises or pay cuts just a little easier to bear for those in jobs. The positive news on inflation may also restore a degree of competitiveness to our economy. It may be prematurely optimistic but these figures also have the capacity to build confidence and possibly increase consumer spending giving some small comfort to a struggling retail sector.

In the face of this escalating crisis, it is a pity that the latest statement from public sector unions did not show a better grasp of the reality facing us all.

Their suggestion that they will consider concessions on increments and premium out-of-hours payments to reduce the state’s wages bill if core wage levels are protected has more than a touch of Nero fiddling while Rome burns about it. Nevertheless, the majority of public sector trade unions have nailed their colours to the mast by declaring that they will not accept pay cuts.

Before any crisis talks there is inevitably a considerable degree of claim and counter claim. Some of it is aimed at union members, more of it is for a different constituency but if this is really the position of the public workers then we are in for a very difficult time. Over to you Mr Cowen.