The timing is dreadful. Today is the day that the cabinet meets in Liverpool to show solidarity with northern workers.
There have been announcements aplenty, such as new apprenticeships (which may or may not really be new – witness this cringeworthy interview with Tony McNulty, employment minister, on last night’s Newsnight).
And then Nissan drops the bombshell: the car giant is to cut 1,200 jobs at its plant in Sunderland as sales slump. That is a large proportion of the 5,000 workers at the factory, one of the biggest employers in the north-east. It’s “devastating” news – in the words of Derek Simpson of Unite.
Ministers had until now been boasting* about a deal whereby Nissan workers would work part-time and receive training during the rest of the week – the sort of deal which could be replicated elsewhere to (supposedly) prevent redundancies. It obviously hasn’t worked.
The news also puts further pressure on the government to come up with help for the ailing car industry, which has been begging for money for months. Jaguar Land Rover (owned by Tata of India) is the most high-profile carmaker in dire need of help.
PA reported today that Nissan sales for December 2008 fell 27 per cent compared to the same month of 2007 – worse than the national decline of 21 per cent.
* Here is the press release from skills secretary John Denham in December:
“John Denham, Secretary of State for Skills, has been working with the FE sector to highlight what they can do to help companies in their area deal with the economic downturn and to prepare for economic recovery…
He will use the examples of two companies, Nissan and JCB, as examples in which the local FE colleges and regional LSC has been able to develop a rapid response to the developing situation….
Nissan staff are currently on a four day week and the company is using the 5th day to train its staff. It is working with Gateshead College on training for staff which is focused on improving productivity….
These initiatives are part of the broader work that the government is undertaking under the auspices of the National Economic Council to take an active role in helping companies survive the recession and thrive afterwards. This kind of action by government is in sharp contrast to the approach taken by the Conservatives during the last recession in which very little support was offered to companies which were struggling.
John Denham will say: “We know that companies that invest in training are two and a half times more likely to survive a recession than those who don’t. I would urge any company, large or small, which is considering short working to follow the example of Nissan and JCB and to talk to their local FE College or LSC to see what training they can offer their staff during downtime….Companies like Nissan and JCB tell me that they can already see improvements in their business as a result of the training.”