Dr Ed Atkins explores the experiences of MG Rover workers after the closure of the Longbridge plant and draws parallels to green skills policies today. This blog is based on a recent report by Dr Atkins – Skills Matter in Place-Based Green Industrial Policy: Lessons From the Closure of MG Rover, 2000-2005
Net zero has brought many positive stories of job creation and economic renewal. Yet it has also been criticised as too costly and affecting people’s jobs. The closure of the blast furnaces at the Port Talbot steelworks, resulting in the loss of 2,800 jobs, has been held up as a cautionary tale of the economic and social costs of net zero.
The debates highlight a crucial question: how to support workers retrain and move into new roles during the transition to net zero?
Those most vulnerable to the economic shocks of decarbonisation (through the closure of high-emissions workplaces) are often places that are already on the economic periphery. This includes post-industrial, rural and coastal communities.
Workers in these places are often dependent upon one or two large employers or on relatively low-pay, low-skill but socially valuable work (such as in health and social care). In these places, the closure of a workplace will have significant ripple effects for the local economy.
One key area of interest lies in how workers might be retrained in new skills to move from one sector or role to another. In a recent LPIP Hub report, I explored similar approaches in the wake of the closure of MG Rover’s Longbridge plant in Birmingham in 2000. In doing so, I highlight how skills-focused interventions did support workers and communities, but with uneven outcomes.
What MG Rover teaches us
The closure of MG Rover was both a slow burn (being predicted) and an economic shock (with site closure having significant impacts on workers), allowing a series of different policy interventions.
In the early 2000’s, the West Midlands region was the heart of the UK’s automotive industry, with supply chains spreading across the region. MG Rover’s manufacturing was situated in Longbridge, south Birmingham, employing 6,000 workers.
Warnings of MG Rover’s demise came early. MG Rover’s size and location in regional supply chains created vulnerabilities across the region. From 2000 onwards, policies introduced focused on proactively diversifying the regional economy away from a reliance on MG Rover. This worked. The number of companies deemed dependent on MG Rover dropped from 161 in 2000 to 74 in 2005, with an estimated 1,500 jobs being saved across the region.
MG Rover called in administrators in April 2005, and the Longbridge plant closed on 15 April 2005. This economic shock prompted new interventions, providing opportunities for workers to develop the skills required to access new roles.
Action at Longbridge involved a multi-actor coalition, including local authorities, community-based networks and local advisory groups. This approach worked, mitigating the potential wholesale impacts of MG Rover’s closure. Yet the focus on skills did not benefit workers across the board and, instead, privileged some and left others in lower-paid work away from the manufacturing sector.
Implications for a place-based green industrial policy
The case of MG Rover underlines the importance of place-based and collaborative work to support workers who are likely to be impacted by ongoing change.
It shows how industrial change and decline is rarely sudden. A moment of closure illuminated vulnerabilities that have accumulated over a period of years. Without proactive, place-based intervention – such as that shown by the MG Rover Taskforce – communities facing net zero’s negative economic consequences face long-term scarring and pain.
When mitigating the plight of individual workers, policy interventions can often focus on finding workers new roles as quickly as possible, identifying like-for-like replacement roles in similar industries. In this case, many workers found jobs with similar skill profiles but much lower pay.
Without a managed transition, these workers would likely have encountered even lower-skilled, lower-paid and more precarious work due to the cumulative impacts of Longbridge’s closure. However, ten years on, unemployment in the area stood at 13.8%, close to twice the regional average for the West Midlands.
Future policy interventions must look beyond prioritising getting workers into new jobs as quickly as possible. Approaches to retraining must be paired with broader policies to build regional demand across the economy. This includes linking retraining to multi-year contracts to support regional supply chains and growing industrial demand.
Skills pathways must be designed with a secure job at the end of them. Otherwise, retraining can simply move workers from one at-risk workplace to a different form of precarity. A more sustained, joined-up approach ensures that the slow burn of industrial precarity does not become a prolonged economic loss for those affected.
This blog was written by Ed Atkins, Associate Professor, School of Geographical Sciences, University of Bristol.
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Disclaimer:
The views expressed in this post are those of the author and not necessarily those of City-REDI or the University of Birmingham.