Investing in North East workers

Danny Cramman reports on the rise and fall of North East employment through inward investment

Workers at the Nissan plant in Sunderland
Workers on the Nissan plant

After the demise of heavy industry, in the North East, the region has seen a real diversification in employment much of which has been through inward investment from overseas.

While Nissan is definitely the ongoing inward investment success story for the North East, other major projects have closed or ceased production leading to the loss of employment for production workers.

Nissan signed an agreement in 1984 to build a car plant in the UK on an 800-acre site at Washington on the former Sunderland Airfield (previously RAF Usworth) and the plant which was constructed by Sir Robert McAlpine began production in 1986. The overall complex has seen considerable extension and new development while supply chain companies have also opened manufacturing and logistics facilities close by.

Nissan’s Sunderland plant is estimated to represent more than £3.5bn of investment and the plant has been the UK’s largest car producer for 15 years and the biggest car exporter for 13 years employing about 6,000 staff with more jobs in supply chain companies.

Last week the company announced it is to build a new 270,000 sq ft, £250m production plant with potential to create another 1,000 jobs.

By way of contrast other major inward investment projects have not proved successful resulting in closure of production facilities.

The Siemens semiconductor plant in North Tyneside opened in 1997 to produce computer chips but closed in 1998 with the loss of 1,100 jobs. The plant was acquired by Atmel, a USA semiconductor manufacturer which ceased production at the plant in 2008 with the loss of 600 jobs.

The property was acquired by Highbridge Business Park, the developer of the highly successful Cobalt Business Park. The main office complex was retained as the Cobalt Business Exchange, the production facilities were demolished to make way for the construction of new offices and data centre buildings.

At Wynyard Park, Samsung opened new production facilities in 1995 and land was acquired alongside the A19 to accommodate expansion. The closure of the plant was announced in January 2004 resulting in the loss of 425 jobs – they had planned to employ up to 3,000 people.

At Newton Aycliffe, Fujitsu, the Japanese chip market company opened a £350m semconductor plant in 1991. The plant ceased production in 1998 and closed in the December of that year with a loss of 600 jobs. It was acquired by Filtronics in 2000 and recently the current occupier RFMD announced 200 job losses and that it may close the production facility in the near future.

On a brighter note for Newton Aycliffe is the development of Hitachi’s first train factory in Europe at a cost of £82m for the manufacturing plant which is being developed by Merchant Place Developments. Construction work is due to start this year with production likely to commence in 2016 with the prospect of 730 new jobs.

:: Danny Cramman is head of Industrial Agency, GVA, Newcastle


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