UP to 35 disabled workers in the North East face redundancy after the Government announced attempts to save a Remploy plant had failed.
The site in Sunderland is to close along with seven others across the country.
Ministers announced last year that it was under threat, but attempts were made to find a buyer for the packaging business based at the plant.
Esther McVey, minister for the disabled, said in a Commons statement its fate had now been sealed.
She told MPs: “There are no viable bids for the Packaging business based at Norwich, Portsmouth, Burnley and Sunderland. These sites will now move to closure.”
It follows the closure of Remploy facilities at Gateshead, Newcastle and Ashington last year.
Employees affected by possible redundancy will be supported with an £8m package to help them move into mainstream work, she added.
Ms McVey said the Government had announced last year it would implement the recommendations of an independent review to withdraw funding from Remploy factories and redirect it to enable more disabled people to find jobs, adding that £50m was going into funding “failing” factories.
Remploy had been trying to transfer the remaining seven businesses, in 18 factories, to new owners, but that has failed.
Ms McVey added: “For all disabled ex-employees, we have put in place a package to provide a comprehensive range of support for all disabled individuals made redundant as a result of Remploy factory closures.
“This tailored support is available for individuals to access for up to 18 months after their factory closes and includes access to a personal case worker and a personal budget, to help individuals with their future choices.”
But Sunderland Central Labour MP Julie Elliott said: “This is devastating news and in the current economic climate I am concerned about what the future holds for these workers.”
Jerry Nelson, national officer of the GMB union, said: “This is devastating news but not untypical from this uncaring government who cannot be relied on to protect the vulnerable.
“There is an alternative. These workers could be put back to work making uniforms for our troops, police and nurses and furniture for our schools like they did before the work was outsourced to China.
“Sheltered workshops are allowed under EU procurement rules and can successfully keep disabled workers gainfully employed if supported by public contracts.”
Unite union regional officer Kevin Hepworth added: “This cruel announcement continues the unrelenting attacks on disabled workers. This latest statement is dressed up by promises and funding that no-one can realistically access.
“It is totally the wrong time to close these factories - the better option would be to create community hubs helping the unemployed disabled and other disadvantaged unemployed people.
“The Government has turned its back on the disabled in Scotland by closing the last five Remploy sites there.
“Yet again, this coalition lives up to its reputation for callousness and cruelty to some of the most vulnerable people who want to make a contribution to society by working.”