§ Mr. Spearing
To ask the Secretary of State for Employment what calculations or assumptions are made of the consequential effects of redundancies, and reduced purchasing power, on employment in the supply of other goods or services; what studies have been made of such effects in areas of local employment offices where major redundancies in shipbuilding, coal mining, engineering or other employment concentrations have taken place; and what conclusions have been drawn from such studies.
§ Mr. McLoughlin
The effect of redundancies varies with the circumstances involved. The Department does not therefore use any standard assumptions in assessing any knock-on effects of redundancies on the localities in question or on the economy overall.
Since 1990, the Department has commissioned two studies looking at the broader effects of large-scale 122W redundancies on local economies. The first entitled "Sellafield Redundancies: Labour Market Effects" examined the rundown of construction activity at British Nuclear Fuel's Sellafield site. The research, which was undertaken by the Planning, Industrial and Economic Development Advisers (PIEDA) consultancy, indicated that for every 100 jobs disappearing at the Sellafield construction site, about 20 additional jobs would disappear in the rest of the west Cumbrian economy. The second study, entitled "Research into Redundancies at VSEL, Barrow", was also undertaken by PIEDA. This study looked at the effects of the expected fall in employment at the VSEL shipyards in Barrow on the local travel-to-work area. The consultants estimated that for every 100 jobs lost at the shipyards, an additional I I jobs would disappear in the local economy. The studies did not examine the broader effects, either positive or negative, outside these localities on the United Kingdom economy overall.