A few short days after the triumphant headlines and enthusiastic back-slapping that accompanied news that the first cars will soon roll off the revived production line at Longbridge in Birmingham comes a far more sobering and enlightening story.
Last week, the new Chinese owners of the MG brand – Nanjing Automobile – said production would restart within months and that it would employ many former Rover workers. It came two years after the collapse of Rover and Nanjing reinforced its pledge to “revive, maintain and develop” MG cars at the plant.
Now a survey by the union Amicus has revealed that a quarter of the workers who lost their jobs are still unemployed. The union also found that of those who are employed, one fifth are only earning the minimum wage in their current job – marking a 50% fall from their previous salaries (http://news.bbc.co.uk/1/hi/business/6329651.stm).
Despite the positive spin provided by Nanjing, the simple truth is that although car production will return to Longbridge it will not be on the same scale as before. The restarting of production lines does not signal a green light for all those who lost their jobs when MG Rover collapsed to return to the plant.
The new MG brand will be very much a niche player in the fiercely competitive car industry. At a time when many of the main global brands are struggling badly, Nanjing will not want to risk the type of investment required to bring Longbridge back to the same levels it was prior to the collapse.
The fact that so many still appear to be basing their hopes on such traditional manufacturing industries does not bode well for Birmingham and the wider Midlands. The automotive industry can and does still play a significant role in the local economy, but the days when car was king are long gone.
The region’s economy needs to continue diversifying to ensure it is not left behind. It also needs to find ways to provide the right sort of training and job opportunities are available for the those no longer able to use their skills and expeience in traditional industries that are fast disappearing.
The resumption of production at Longbridge is a cause for celebration. But it also needs to be put into perspective and is not the answer to the serious problems facing the local economy.