Oral - Job Losses in Cardiff

I wish to make a statement on the announcement of job losses in Cardiff South and Penarth by JR Freeman and Carrington Wire Ltd.

I am sure that the whole Assembly will recognise that these announcements are disappointing news, not least for the workers who are directly affected, and our thoughts are with them and their families at this time.

Nevertheless, I am sure that it is also important for us to recognise that this news takes place against the background of what remains a vibrant local labour market, boasting levels of unemployment and employment that are among the best witnessed for a generation. For example, in Cardiff South and Penarth, the number of jobseeker’s allowance claimants has fallen by some 13 per cent on the previous year. Against such a positive economic background, we hope that the long-term impact of these job losses will be muted.

On Carrington Wire, following a 90-day consultation process, the company announced to its staff last week that it will be closing its Cardiff plant in December with the loss of 123 jobs. The consultation was launched in response to commercial pressures, primarily created by cheaper imports from the far east. Throughout the consultation, my officials worked closely with the Cardiff management team to develop a strong business case that was designed to safeguard up to 70 of the 120 jobs at Cardiff by relocating certain operations to a more cost-effective location. This was well-received by Carrington Wire’s executive board, but, having considered all the options, the board has recommended the closure of the Cardiff site.

It was also announced last week that JR Freeman’s century-old cigar factory in Grangetown, Cardiff, which is responsible for the production of Hamlet cigars, will close in September 2009, with the loss of 184 jobs. Japan Tobacco, the owner of JR Freeman’s factory, took the decision against a backdrop of falling cigar sales and the fact that it is no longer commercially viable to retain the Cardiff site. The job losses at JR Freeman will not take effect until September 2009, so there is time available for those affected to secure new employment or training opportunities in what remains a healthy local labour market. Of course, my officials also stand ready to assist the affected employees of both companies to find alternative employment and training.

Cardiff South and Penarth, like much of the rest of Wales, continues to attract investment opportunities. Major developments, such as those taking place within Cardiff city centre at St David’s 2 and around Callaghan Square, are reshaping the city and they bring with them new jobs and opportunities. The city’s burgeoning reputation in financial and legal services is also bringing quality employment, such as the 135 new jobs recently announced by Hugh James Solicitors.

In any dynamic economy, jobs are lost as well as created. What is important here in Wales is that we continue to create far more jobs than we lose. To focus on job losses and company closures alone rather than on new jobs and company expansions creates a false picture of the Welsh economy. We should be congratulating ourselves on creating these jobs, while recognising that we will do what we can to assist those communities that directly suffer because of job losses.