THE MOTOR INDUSTRY IN A DEVELOPMENT DISTRICT: A CASE STUDY OF THE LABOUR FACTOR
| Author | J. F. B. Goodman,P. J. Samuel |
| Date | 01 March 1966 |
| Published date | 01 March 1966 |
| DOI | http://doi.org/10.1111/j.1467-8543.1966.tb00935.x |
THE MOTOR INDUSTRY IN
A
DEVELOPMENT DISTRICT:
A CASE STUDY OF THE LABOUR FACTOR
J.
F.
B.
GOODMAN*
AND P.
J.
SAMUEL**
ALTHOUGH it is generally accepted that the relocation of industrial invest-
ment will serve to alleviate the problems of areas of high unemployment,
there is a need for
a
more detailed examination of the processes involved.
The purpose
of
this article is to examine the experience
of
one motor firm
which has recently extended its operations by expanding in a development
district-l Emphasis will be placed on the labour and recruitment problems
involved
in
establishing the industry in an area which had little or
no
experience
of
its production technique, the sources
-
in terms
of
industry,
occupation and geography
-
of its labour, and the effects
of
the arrival
of
a
new large employer on the labour market and on the firms already
established in the area. Finally some attempt will be made to evaluate on
the one hand the experience
of
the firm in the new area and on the other the
degree of success
of’
this project in achieving the aims of government
locational policy and the
1960
Local Employment Act.
THE
REGIONAL
PROBLEM
The expansion
of
this firm was one
of
the several motor indus try schemes
announced in 1960, projects which collectively could be described as being
the outstanding feature
of
recent government policy on industrial location.2
Moreover
at
the time
of
writing3 speculation about the further expansion
of
the motor industry is widespread, and it is confidently expected that renewed
expansion will shift the distribution
of
the motor industry,
as
in 1960, away
from its traditional areas of operation. This expectation
of
the continued
use
of
the motor industry as an important tool
of
government locational
policy adds significance to the present study and contrasts sharply with
government policy during much
of
the 1950s. For instance in December
I
954, during the Adjournment Debate on the Industrial Development
Plan for Dagenham the Parliamentary Secretary, in reply to opposition to
the large expansion
of
Ford’s in the district, said
‘.
.
.
It
is irnpossible to
keep a great industry in
a
strait jacket, or to ignore its existing location.
.
.
.
*
Lecturer in Industrial Economics, University of Nottingham
**
Research Officer, London School of Economics and Political Science
1
For
various reasons it is necessary that the firm and consequently the development district
concerned remain undisclosed.
2
Ministry of Labour 1965, Manpower Studies
No.
2
The
Mefal
Industries,
p.
70,
referring to
the Motor Industry
-
‘About a third of the increased employment between
1958
and
1963
came
from expansion projects in the development districts.’
July 1965
336
THE MOTOR INDUSTRY IN
A
DEVELOPMENT DISTRICT
337
An industry which has proved itself efficient is not the worst judge of the
conditions of
SUCC~SS.’~
Government policy over the regional distribution of
industry has certainly been through
a
process of change since that date, and
although some of the quoted attitudes may still influence decisions in
particular cases, the degree of their application to the motor industry has
shifted.
So
too has the reason for continued and perhaps enhanced interest in
the areas of high unemployment. Initially perhaps the main, though by no
means only, reason for concern was on political and social grounds, and the
provision of relief through the encouragement of new industrial activity in
these areas was motivated by human considerations. Whilst this influence
may linger, there has developed an increased awareness of the potential
value of unemployed or under-employed labour resources existing within
an otherwise fully employed economy, and the frequent evidence
of
labour
scarcity in many areas has added force to this argument.
In
a
situation
where the achievement of a higher rate of growth has received concentrated
attention, the existence of unused labour resources in certain areas provides
the possibility of an almost immediate increase in gross national product.
Moreover if unemployment levels in all the
less
prosperous parts of the
country were to be brought closer to the national average rate through the
provision of more jobs in the present areas of higher than average unemploy-
ment, then the level of ‘sustainable growth without inflation’ would be
raised. Briefly, the familiar situation in which control and stability can be
achieved in the Midlands and the South only at the expense of increased
unemployment in the North of England, etc., could be avoided. Certainly
the dispersal of the motor industry away from its traditional areas of
manufacture which have been, and remain, characteristically areas of
excess demand for labour
is
an important step in this direction.
Not only has the emphasis placed on the varied reasons for, and the
basis
of,
government regional thinking changed, but also the areas
scheduled to receive assistance, and particularly their size, has changed
with a frequency which induces uncertainty both in firms considering a
change in location and in the areas concerned. The
1960
Local Employ-
ment Act marked a significant change in the scale of the areas scheduled to
receive assistance, in terms
of
Treasury grants, etc., to firms establishing
in the areas of high unemployment. The Act reduced the size of particular
areas, and though the number of districts placed on the list was high, the
proportion of the insured population covered fell from
I
7.9
per cent to
I
2.6
per cente6 The
1960
Act has been much criticized,’ especially for its con-
centration on very small Employment Exchange districts rather than
looking more broadly at the development of planning
on
a
regional basis,
4
Hansard, December
7,
1954,
Col.
929
6
See N.E.D.C. ‘Conditions Favourable to Faster Growth’, para. 54
et.
seq.
6
Quoted in N.I.E.S.R.
Economic
Review,
August
1963, Table 11, p.
47
7
For
a full list ofrecent criticisms see N.I.E.S.R., ‘The Regional Problem’,
Economic
Reuiew,
August 1963
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