Unemployment (Leicester)

– in the House of Commons at 12:00 am on 28th May 1971.

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2.28 p.m.

Photo of Mr Greville Janner Mr Greville Janner , Leicester North West

I am pleased to have this opportunity to raise in the House a matter which, though it may appear parochial, reflects a situation which prevails in many parts of the country. I refer to unemployment in the City of Leicester and the Leicester area—an area which has enjoyed prosperity throughout the centuries but which, in common with many similar parts of the country, is beginning to suffer from the effects of severe unemployment.

I know full well that Leicester's unemployment is not at a level such as that which afflicts Glasgow, for example—my hon. Friend the Member for Glasgow, Gorbals (Mr. McElhone) will be referring in the next debate to the tragic situation in his constituency—but I hope that the Minister will not answer the matters which I raise by telling my unemployed constituents that they are better off than people in other areas. If a man is unemployed in Leicester he is as badly off as if he were unemployed in Glasgow or anywhere else. If he has not got the work with which to feed his family, to earn his living, to preserve his self-respect, he is indeed, in a way, worse off in an area where there are more people at work than in one in which it is felt that unemployment is a commonplace. It is bad everywhere to be unemployed, and I beg the Minister not to offer spurious consolation to the 4,300-odd people now unemployed in the Leicester area, or to their families, because they will not thank him for it. Neither should he address this sort of consolation to over 1,000 work people who have been warned that they will be made redundant shortly, and to whom I shall refer in detail, the majority of them coming from one Dunlop plant in my constituency, St. Mary's Mills.

The background is simple. Right through the centuries, going back to the time of Wolsey and beyond, the hard work and effort of the people of Leicester have kept the area prosperous. Even in the grim days of the depression, in the 1930s, Leicester, thanks to its boot and shoe industries, hosiery and a wide variety of light engineering, managed to remain prosperous. Now, for the first time, my constituents are seeing very substantial unemployment and the probability of greater unemployment in the future.

Time and again I am asked the same question: who is next? If the Rolls-Royce plant at Mount Sorrel can go; if the Dunlop plant which has been working for 104 years can be closed down, who next will have to apply for social security benefit? V/ho next will lose a job which, in many cases, is in a trade or profession followed by his grandfather and father before him?

The position today has been very clearly and well set out by the Leicester Chronicle, a paper to which I am greatly indebted for the careful survey which it carried out recently. I wish to refer to the memorial to lost jobs; to the death of a series of excellent companies or plants set out in the Chronicle of 14th May. Each of these redundancies has an unhappy tale to tell for the people involved, and an unhappy moral for others likely to be placed in the same position. This is only the memorial from 8th February this year: February 8: 87 employees at the Stoughton Street, Leicester, factory of Rank Precision Industries to be made redundant. Redundancies spread through all sections—management, supervisory and shop floor workers, semiskilled and unskilled. Unemployment is no longer simply the problem of the unskilled worker and the labourer. It is also the problem of the executive, the manager, the man who has fought his way through his university examinations and emerged to find that there is no longer work for him.

The reason given for the redundancies at Rank Precision Industries was: Cutback in overseas business, particularly with the USA.February 11: More than 200 workers in the making-up department of Robinson and Pickford (1928) Ltd., Leicester knitwear manufacturers (who employ 230 people) to be made redundant 'within the next few weeks.'Reason given: Company's unaudited losses of £104,000, sustained last year, were worse than originally forecast. That is the knitwear industry, a staple industry of Leicester. February 18: Holyoake and Brown, Great Central Street, Leicester, one of city's old established small family shoe manufacturing firms to close 'within the next few weeks', making about 40 operatives redundant.Reason given: Adverse trading conditions in shoe trade over many years. The boot and shoe trade is another staple industry upon which Leicester has survived and flourished over the years. February 23: Fredk. Parker Ltd., engineers, Viaduct Works, Catherine Street, Leicester, announce redundancies for 87 of their 1,200 labour force. All grades affected.Reason given: Order book decline 'brought about by the situation prevailing in this country and abroad'.February 26: North Bridge Engineering Company pay off 43 men in their forging and precision fasteners division at their plant and Aylestone Lane, Wigston factory.Reason given: Substantial cuts in production programme 'as a result of the Rolls-Royce situation'. The Mount Sorrel works closes and the Rolls-Royce situation affects the subcontractors, and all over the Leicester area there are sub-contractors of Rolls-Royce. February 26: Cannon and Stokes, Leicester engineers, announce redundancies for 43 men. Men drawn from a variety of trades, including turners, inspectors, labourers and machinists. Mainly those with less than 12 months service with firm.Reason given: Lack of orders following the Rolls-Royce collapse, 'particularly the parts being made for the RB-211'. That is light engineering, the type of industry which has kept Leicester and similar cities flourishing. March 19: Morton Potter Ltd., building and civil engineering contractors of Barkby Road, Leicester, to close as builders. Decision makes whole of their 82 staff and employees redundant. However, firm to remain in existence after disposal of assets, as property and investment company. That will hardly be a consolation for the employees. Reason given: The economic state of the country and the building industry.March 30: The Herbert B.S.A. company announce they are to close their Sanvey Gate, Leicester, factory. About 180 jobs lost, including those of 12 apprentices. Sam Barston, A.E.F. district secretary, says, 'This is the biggest blow so far as a single factory is concerned'. He said that before we learnt of the Dunlop plant. I am happy to take this opportunity to pay tribute to Mr. Barston and his trade union colleagues for the work they are doing in the present potentially disastrous situation. The reason given for the Herbert B.S.A. decision was: Continuing decline in orders for machine tools.April 5: Lingerie and knitwear firm of B. and R. Mellors Ltd., Northampton Street, Leicester, reveal they have made 40 women operatives redundant in last fortnight.Reason given: Adjustment to manufacturing requirements. For the first time we have women being affected by unemployment, this in an area where far more wives than the national average go out to work. April 6: Further batch of 120 redundancies announced by Rank Precision Industries. Latest batch involves people 'right across the board' at the East Park Road, Gipsy Lane and Lee Circle premises.Reason given: Word trade recession.April 16: 'Black Friday'. Fight to keep Dunlop's St. Mary's Mills, Leicester, in operation reported as 'finally lost'. Prospects of complete closure by end of March, '72, and loss of 670 jobs. I am told that that should read "over 800 jobs". Reason given: Unprofitable position in the cycle tyre market.April 20: One bright spot as news comes that sackings at the Braunstone works of Reid and Sigrist, about 70 since Christmas, have now been halted. Thank heavens for that! April 26: United Shoe Machinery Corporation International to close Craven Street, Leicester, unit of subsidiary, Elta Plastics Ltd. Jobs of 49 people to go. They are the people who make the machinery to make the shoes. Reason given: Changing styles in women's footwear"— as if styles in women's footwear have not been changing through the centuries. 'Decision does not reflect fortunes of shoe industry', says Elta company secretary. I beg to differ. April 29: A. James Portch Ltd., Leicester manufacturers of skirts, slacks and sportswear announce they are to close factory by end of June. Business to be transferred to Scotland. About 100 employees affected.Reason given: Local staff recruitment difficulties. I shall invite the Minister shortly to conduct a full and thorough inquiry into whether the reasons for some of the closures, including that of A. James Portch Ltd., is the transfer of work and factories to other areas where incentives are given to indus- tries to open. I am not suggesting for a moment that the Government should cease to attract industries to development areas. What matters to me is that they should not allow Leicester itself to become a development area. There should not be a re-deployment of unemployment, but that has been the effect so far of the Government's policies during the last nine months.

I come to 6th May: Calverleys, the Leicester-based firm of building and joinery contractors announce appointment of receiver to take charge of group's affairs. Labour force cut from 1,000 plus to 322 over a period of time.Reason given: Critical state of the liquidity of the group's fund brought about by escalating costs of two large fixed-priced contracts. I shall refer later in some detail to Messrs. Calverley.

On 7th and 10th May there were two bright spots, 40 new jobs in one trade, a sports and scholastic clothing contractors, and 80 new jobs in a knitwear manufacturers, Britella Ltd., Frog Island. About 110 new jobs to be set against job losses running into thousands.

On 11th May there was good news. Another 100 operatives are recruited by Ladies' Pride Outerwear Limited, and we are grateful to Ladies' Pride which has a booming order book.

The picture of Leicester's unemployed can be summed up in this way: January, 1970, 2,754; April, 2,735; I do not have the figure for June, but I think it right to say that when the Government took power, the figure was certainly less than 3,000. January, 1971, 3,185; April, 4,302. What a shameful increase that is! To that must be added the Dunlop men, if the company carries out its expressed intention to close that plant. Adding to that 160 more, to whom I shall refer, and we have a figure of actual and prospective redundancies which may have nearly doubled in the course of 12 months. That shows the seriousness of the problem, not only the people now out of work, but the fact that the problem is getting worse and snowballing, and nobody knows who will be next.

On Friday, 21st May, the Leicester Mercury was announcing once again that there were redundancies at three firms and that 160 more workers were to get the sack. Again I pay tribute to the local Press for the way in which it has drawn attention to the trends in the Leicester area. But it is said to find the papers so often telling a continuation of this unpleasant news. William Cotton Ltd., the Loughborough knitting machine manufacturers, are to make 111 hourly-paid workers redundant and a number of staff employees may also have to be laid off, Alfred Herbert Ltd., the machine tool manufacturers, are to make 27 "white coat" workers at their Lutterworth factory redundant and Wolsey Ltd. are to make 26 redundant at their Bruin Street works in Leicester. Cotton's say their redundancies are due to lack of orders. The decision cames as a bombshell for the workers involved. Of course it did. There has been a series of bombshells in the Leicester area, becoming progressively more serious, because, of course, the more people there are looking for jobs and the fewer jobs there are, the more hardship comes into the life of my constituents.

I now turn specifically to Dunlop and to that "Black Friday" to which the Leicester Chronicle referred. St. Mary's Mill has been open for 104 years. Its closure throws light on the most desperate miseries of this problem. It is said by the Government from time to time that bad labour relations play their part in the present unemployment situation. Leicester boasts excellent labour relations and always has. In the 104 years of the operation of this plant at St. Mary's Mill, I am told, precisely one day has been lost through disputes. That closure certainly cannot be blamed on bad labour relations.

Indeed, the four Leicester City Members were happy to receive the shop stewards from the plant in a delegation to the House of Commons. They were highly intelligent and articulate men and women, many of whose grandparents and parents had worked in the plant. They had negotiated with the local management, with whom they were on the best of terms.

Last October, they were told that the cycle shop was to close, and immediately they took steps to increase productivity, to lower management costs and to lower labour costs. But that did not save their livelihoods.

There have been no so-called excessive wage demands, if such things exist, certainly not in Dunlop. That factor has contributed nothing to the proposed end of that excellent plant. Nor is there any question of a lack of productivity.

One is entitled to ask what the reason is, and one is told that Dunlop propose to open another plant elsewhere. I ask the Minister on behalf of the workers, because I understand that they have not been able lo ascertain this from the top management, whether there is to be a transfer of resources from an area in Leicester which is starting to suffer from severe unemployment to another area which has greater unemployment. Is this a redeployment of unemployment? Will the Minister inquire, so that people will know what the situation is?

The Chairman of Dunlop has been good enough to indicate his willingness to meet local Members of Parliament and we look forward to discussing the matter with him. We have had considerable courtesy from the management, but one dares to hope that this fine, long-standing and excellent enterprise will not be killed off and certainly not because there is a greater tax incentive to open another plant elsewhere. By all means let us open another plant elsewhere, but let us not create unemployment, particularly among people who have worked in the same plant loyally and, in many cases, for generations.

That presents another example of the difficulties created by the unemployment of skilled people. When an unskilled man, or a man with skills wanted in many industries, is made unemployed, there is a reasonable hope that he will find a job in the area where he lives. But in the Dunlop plant there are men who are rubber workers and who have striven in that part of the industry, often for generations. That is their skill; that is their talent. If they are dismissed, where are they to find employment? Where else is there a rubber plant to give work to these good people? There is one other Dunlop plant, so far as I know, in Leicester. The position is very unhappy.

I ask the Minister specifically to comment, not only upon the economic aspects of such closures, but on the human element, because unemployment is not just a question of money, not just a question of enterprises making more money by transferring work elsewhere, but a question of human beings whose families have to be looked after and who are entitled as of right to work.

I referred to Messrs. Calverleys, a longstanding building firm. Here is a clear indication of the snowball effect of unemployment. In my constituency, there is a housing estate, Wyggeston Gardens, an estate of some 200 homes, fairly modest and fairly small, but often lived in by people who have spent their life savings on buying these new homes from Messrs. Calverleys. A lot of these constituents are elderly.

A short time ago, they asked me to a meeting held in a shop owned by one of them. It was packed with people with complaints about construction jobs not being done—problems concerning the public areas, of fences shown on the plans and the show houses but not available—and complaints concerning defects in building. I took this matter up, and received and immediate and courteous reply from the chairman of the company on 30th April. He said: In summary, it is our intention to finish off all the external works so as to get the roads, paths and open areas up to adoption standards during May. We are investigating and carrying out remedial works on the six other complaints. A matter of days later, the firm wrote once again to point out that it was now going into liquidation and was sorry but the circumstances had changed. It said: The attached letter was written to you the week before last… Since then the appointment of a Receiver has been made for the Company. At the present time we are unfortunately not in a position to deal with the complaints which were the Company's responsibility but this should be determined in the near future. When unemployment comes, it hits not only those who are unemployed. It hits the people who were creditors in one sense or another of the company concerned. When people become unemployed, not only does their self-respect suffer but they cease to be producers. They are fully entitled to unemployment benefit; they have earned it and they need it. But they do not want to live that way. Nor, indeed, is it to the advantage of the community that they should live that way. Once they receive unemployment benefit, it affects the tax position of the rest. And the unemployed cease to be good customers of local shops and industries and house builders. So the snow- ball continues to roll and all are affected. It is easier to stop unemployment at its inception, before it gets really serious, than it is to roll the snowball back up the hill when the situation gets desperate.

Who, then, are the unemployed in Leicester? There is a complete range of them. The young people so far have not been badly affected and I hope that they will not be. It is very serious when children leaving school cannot find work. Nothing can be worse.

The family is affected. If it is the father, there is the demoralising effect of having to live off his wife's pay while he is looking for work and of knowing that the children know that their father is not wanted.

Then there are the older people—and by that I include even those in their 40s—people who are no longer sought after because they have not got so many years working life ahead of them. Once they reach the 50s and the 60s and find themselves unemployed, it is very difficult for them to get other work. I hope that the Minister will make reference to the problems of the elderly, who are just as entitled to work, who are fully entitled to look forward to a dignified retirement and who should not have to eat up their savings because they are prematurely retired.

The results in Leicester are getting serious. What is to be done? First, I ask the Government to provide a greater stimulation for industry. The Budget has not been enough. It made a start in that direction, but it was too little. It is not getting through.

Secondly, there should be an end to the ignoring of the problem of Leicester's unemployment and the unemployment in other cities that have been prosperous and are starting not to be. I welcome the emphasis upon the development areas, but I beg the Government not to allow my constituency and the area around it to turn into a development area. The problem of the unemployed in Leicester should be regarded as serious now, because, to the 4,000 people now unemployed and the 1,000 others who know that they are to be made redundant, the position is already very serious. There should be an end to this drift into disaster.

Thirdly, there should be a Government inquiry into the transfers of assets and products and work from one area to another. It is right that the development areas should be assisted; it is wrong that unemployment should redeployed so that one provides employment in one area in return for providing unemployment in another.

Fourthly, there should be energetic retraining of unemployed people, where necessary. I want to know how many officers are specifically employed by the Department to look after the unemployed. I suspect that this is one area in which the Government have succeeded in creating a good deal more jobs than before.

The questions which have been raised, and which I am grateful to have had an opportunity to air, affect actually or potentially everyone in my constituency, whether he be a shop floor worker, an unskilled worker, a highly skilled operative, an executive or a senior manager. Jobs at every level are being lost. The situation is deteriorating and I ask the Government to take urgent steps now to deal with it and never again to provide the sort of answer given to me yesterday at Question Time which said, in effect, "Oh, well! There are places which are worse off." Indeed there are, but I trust that Leicester will not be allowed to join the ranks of those cities where unemployment becomes endemic and chronic. I hope that it will not be too long before my constituents cease to ask that dreadful and anguished question when they see firms closing and redundancies increasing—"Who is next?". That is a question which should not have to be asked in this modern age.

2.57 p.m.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

I am glad to have had the opportunity to listen to the arguments so powerfully put forward by the hon. and learned Member for Leicester, North-West (Mr. Greville Janner). Notwithstanding his dissatisfaction with an answer he received yesterday—not from me—I think that he should realise, and I hope that Leicester will realise, that, while we understand Leicester's problems, we have to look at the whole of the country. It is only by doing that that we can assess a proper policy.

The hon. and learned Gentleman has quite fairly acknowledged that the unemployment situation in the Leicester area, although a little less favourable than in recent years, still does not give the same cause for concern as do some of the harder hit parts of the country. I am afraid, whether he and Leicester like it or not, that I must point out. in order to get the matter into perspective, that the provisional May percentage rate for Leicester of 2 per cent. is well below the corresponding rate for the East Midland region, at 3 per cent., and the national average, at 3·3 per cent.

In saying this I would not wish for one moment to belittle the personal problems and anxieties which the loss of a job inevitably brings about. In quoting statistics I am very much aware that it is human beings and not percentage points that is involved. The hon. Gentleman was absolutely correct when he said that unemployment is unpleasant under a Conservative Government as it is under a Labour Government. Unemployment is the unpleasant fact. Nevertheless statistics are a fair indication of the situation, which is by no means unfavourable. The number of vacancies reported to the Department of Employment for women and girls considerably exceeds the number registered as unemployed and nearly 1,000 vacancies are on record for men and boys.

The right hon. Gentleman has directed some criticism at the operation of the Government's regional policies, and I must remind him that for many years successive Governments have operated regional policies aimed at giving priority in the encouragement of new industry to those parts of the country which have to contend with decline in their own established industries.

I was relieved to find that he was not suggesting a lowering of priorities at the expense of Scotland, Wales or the assisted areas of England. I accept that all policies need to be examined from time to time to ensure that it is right to retain the objectives and also to ensure that the methods of attaining those objectives are the most effective possible in the circumstances. This is exactly what we have done recently with regional policy.

The present framework of assistance will enable industry to make investment decisions in future with confidence. When we came into office we set in hand a detailed study of regional policies, which included a thorough examination of areas throughout the country with problems of unemployment and slow growth. We found that against the background of rising unemployment since 1966 the older industrial conurbations of Scotland and the North-East stood out as exhibiting disturbingly high and persistent levels of unemployment while facing massive problems of dereliction and industrial decline.

The policies pursued by the previous Administration simply have not succeeded in counteracting the trends that have led to the situation. It was left to this Government to give priority to those older conurbations by designating the new special development area to direct regional assistance to vital and profitable firms and to link it more closely to the increase of jobs where needed and to make reforms in taxation necessary to give industry confidence to carry out the investment and expansion required for national and regional progress.

I can assure the hon. Gentleman that the policies of this Government are certainly not intended merely to shuffle and shift unemployment about the place. They are much more deeply conceived than that. The hon. Member was worried lest there should be a loss of industry from Leicester to the assisted areas. Again I am sure that he will appreciate that any anxiety he has on this front ought to be greeted with pleasure by his hon. Friends or my hon. Friends in assisted areas where industry is so badly needed.

A word now about I.D.C. control. It is true that not all applications for these certificates for the Leicester area have been approved. The operation of I.D.C. control has been recognised by successive administrations as an essential part of regional policy. Beyond question I should be heavily criticised from both sides of the House if I were not to do all in my power to direct the attention of industrialists seeking to expand towards those parts of the country where unemployment has for many years been a grave and difficult problem. I do not think that the Government administer the I.D.C. policy in an insensitive way. Every application is carefully considered and we do all in our power to ensure that full weight is given to the arguments put forward with each application.

No policy which is aimed at establishing priorities and setting an individual plan in the framework of a national need can please everyone all the time. Nevertheless it is essential that we have an I.D.C. policy, that it should be administered firmly but flexibly and that is the policy of this Government.

I know Leicester, I have been there a number of times. I was there shortly before Christmas and I know that it is a clean and attractive city with a considerable diversity of industry. It is true that some sectors of industry have found it necessary to reduce their labour force recently.

The hon. Gentleman referred to a number of firms. In particular, he referred to Dunlop. We have had no indication that the Dunlop work is to be moved elsewhere. I do not propose to comment on the individual firms concerned because decisions to cut back employment are difficult and unwelcome for management to make, but they are essentially decisions for management. Any enterprise which is carrying too great a burden of wage costs, whether by employing excessive numbers or by granting unreasonable wage demands, is putting its viability at risk and so jeopardising the jobs of all its workers. Movement from job to job is part of the pattern of employment, and the resources of the Department of Employment stand ready to assist all who have to make such a move. In a city such as Leicester there is a variety of industry and of employment which many parts of the country may well envy.

The hon. Gentleman asked me for statistics about the number of employment officers. I regret that I cannot give him that information today because it is a matter for the Department of Employment, but I will ensure that a request is conveyed to the Department and no doubt it will be able to give him the figures in due course. However, the Government recognise the importance of making full use of the skills and abilities of people of all ages. Staff in employment exchanges do all they can to persuade employers not to impose age limits on the jobs they are trying to fill and to engage men and women who can do the job whatever their age.

Under an extension of the Department of Employment's vocational training scheme announced on 25th March professional and executive staff aged 40 and over who have been registered as unemployed for 13 weeks or more may receive financial assistance for short courses above craft level with employers or attend suitable courses where they are available at colleges of further education.

Under a new scheme introduced on 1st January employers in development and intermediate areas—which is not Leicester—who engaged and undertake to retrain workers aged 45 and over who have been unemployed for at least eight weeks can qualify for grants from the Department of Employment. The problem of unemployment among older professional and executive staff is much the same for all parts of the country.

While placings in Leicester decreased in recent months, they nevertheless averaged 330 a month for men and 100 for women in the first four months of this year. A computer vacancy job bank has been set up to help workers affected by Rolls-Royce redundancies. Leicester is one of the offices receiving copies of the computer printout. Plans are in hand to outhouse unemployment benefit work at Leicester and modernise the existing office to provide better facilities for employment work. The Occupational Guidance Service at Leicester was strengthened in October, 1970.

Leicester has been noted for many years for its bustling prosperity, and the slight check to its progress which has been noticeable recently is, I am convinced, only temporary. The area has an underlying strength and confidence which will ensure that as business confidence is re-established by the policies we are continuing the upward trend will be restored. As the hon. Member will be aware from the answer to his Question earlier this week, which he did not like, unemployment in the Leicester area is still considerably below the national average. This bodes well for the future when the economy starts to move again.

Photo of Mr Anthony Grant Mr Anthony Grant , Harrow Central

It will be very much quicker than was the case in the four years between 1966 and 1970.

I have been abroad recently on a number of occasions engaged in trade activities, and I can assure the House that Leicester's industrial skill and the expertise of those engaged in it are widely respected overseas. This, I think, also can give cause for confidence. I believe the locality will benefit from the stimulation of business confidence at which the present Government's policies are aimed. To bring this about, these are the sort of things which the hon. Gentleman and his friends and, I hope, the Leicester Chronicle, will be publicising, if they wish, as I believe they certainly do wish, to attract industry and to bring prosperity to that area, because once this has been achieved, once the Government's economic policies have taken effect, I believe the future prospects for Leicester's industry and its people are excellent.