Tuesday, August 21, 2007

Another Manufacturing Company Cutting Back

Chips are down for 120 workers at McCain factory in Staffs

Up to 120 jobs are to be axed from a frozen food plant in Staffordshire. McCain Foods announced yesterday that "local environmental constraints" at its site in Wombourne had made the production of chips uneconomical.I wonder what environmental constraints are or is it just that people are cutting back on frozen foods.

Posted by jj @ 08:27 AM (1052 views)
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9 thoughts on “Another Manufacturing Company Cutting Back

  • who eats expensive frozen chips anyway? better off making your own… goodbye McCain…lol….the MCjob..

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  • Thanks to house prices the workers can’t afford to live on the wages that workers in other parts of the world would be happy on. Therefore factory moves. Another consequence of absurd house prices. Oh well, not long to go now.

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  • The fact is the UK is a very expensive place to live hence labour costs being so high, the result is if you can’t import it it’s going to be expensive. The upshot is were becoming less competitive in the global market and jobs are going to countries with a lower cost of living. Upshot is unless we lower our labour costs were screwed.

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  • mrmickey – Labour costs or capital, legal and infrastructure costs? From what I have seen labour costs are often a drop in the ocean of running a small company – it is all the other pigs with their snouts in the trough that cost real money. If a job cannot be done at minimum wage, then it isn’t worthwhile doing. However, you are correct – there are 5 billion people on this planet who want to live a little more like the 1 billion on the top of the pile and will undercut us. Slavery has always been necessary for some to live RELATIVELY well. Once we kept our slaves at home, for a few hundred years we off-shored our slaves so we didn’t have to dirty our consciences with it. That is changing. The simple fact is that not everyone can live as the UK middle classes do and the global economy will be a leveller. Unfortunately, I fear we will end up with a world with even higher variance in lifestyle – with even fewer having even more luxurious lifestyles and more with a slightly better life than most have now, but a significant drop of median western lifestyle.

    My oh my, reading the above I sound incredibly pink don’t I? It’s not the case; I believe in self determination, hard graft etc., but capital does have a gravitational effect and someone has to come up with a solution to that problem, which is a social evil, whilst not destroying the motivation for industrious behaviour. Maybe there is no solution.

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  • d’oh I agree it’s not just the labour costs it’s the mountains of bureaucracy that businesses are now faced with which act as a drag on this countries competitiveness. It also appears that as the real economy shrinks more & more state funded inspectors and snoopers are being created to take up the slack in the employment numbers. I suppose once the financial services sector in London is sourced out the UK will look like a hollowed out version of East Germany with everybody working as state funded snoopers.

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  • “Labour costs or capital, legal and infrastructure costs? From what I have seen labour costs are often a drop in the ocean of running a small company – it is all the other pigs with their snouts in the trough that cost real money. If a job cannot be done at minimum wage, then it isn’t worthwhile doing. However, you are correct – there are 5 billion people on this planet who want to live a little more like the 1 billion on the top of the pile and will undercut us. Slavery has always been necessary for some to live RELATIVELY well. Once we kept our slaves at home, for a few hundred years we off-shored our slaves so we didn’t have to dirty our consciences with it. That is changing. …etc”

    Wow, now that is what I call a real ramble. Unsupported statements (labour costs a drop in ocean), random tangents, incoherent message.

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  • C’mon guys, you voted to live in a nanny state.

    Fords recently moved some component production from Essex/N. London to Hungary. Easier legislation, supportive political climate and a lack of speed cameras outside the factory gate…. What more could you want?

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  • “Wow, now that is what I call a real ramble. Unsupported statements (labour costs a drop in ocean), random tangents, incoherent message.”

    Ah-so Yep, it is a bit of a ramble, but a logical one.

    I work in a small company. Labour costs are a drop in the ocean in our business. May not be true in every business, but it is certainly the case in mine.

    The UKs standard of living is supported by the fact that we can buy clothes, electronics, made elsewhere for a pittance etc. The reason these can be made for a pittance is because of non-existent regulation and lower standards of living in those countries. If they had lives similar to ours, we would have to pay more for these goods – hence we would have a lower standard of living. That sounds like exported slavery to me. Ceteris paribus, without an increase in productivity, if those who produce/manufacture the goods that make our standard of living have an increase in their standard of living i.e. their real wages increase, then these goods will eventually cost us more, hence our standard of living will drop. In a global market, and over time, the relative earnings of those doing similar jobs should converge. The average Indian’s standard of living will go up, the average standard of living of a UK citizen will go down because the Indians are keeping a greater portion of their “effort”. Now there are all sorts of caveats and ifs and buts to that analysis, but I happen to believe that the indicators point to this being where the UK is heading.

    If the tangents seem random to you, then you just haven’t thought enough.

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  • Guys – I worked there until recently so I know the real problem – local people didn’t like the smell of chips frying in their neighbourhoods . The company spent (literally) millions trying to improve it and most smells were stopped , but some sensitive people still kept complaining , and complaining and complaining …… the continuous pressure on the plant via the Environment Agency , EHO and the press was just too much . 120 people have lost their jobs because 5 people complained . There were also 3 people who complained about the noise from the factory when they were over 3/4 mile away – this was scientifically disproved but they kept complaining anyway – again these people were given time in the press slinging mud without proof or substance . In the end McCain have a brand to protect and the bad press (unwarranted) pushed the plant over the edge .

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