Auto plant closures, policy responses and labour market outcomes:a comparison of MG Rover in the UK and Mitsubishi in Australia


This paper provides a preliminary comparative longitudinal analysis of the impact on workers made redundant due to the closure of the Mitsubishi plant in Adelaide and the MG Rover plant in Birmingham. Longitudinal surveys of ex-workers from both firms were undertaken over a 12-month period in order to assess the process of labour market adjustment. In the Mitsubishi case, given the skills shortage the state of Adelaide was facing, together with the considerable growth in mining and defence industries, it would have been more appropriate if policy intervention had been redirected to further training or re-skilling opportunities for redundant workers. This opportunity was effectively missed and as a result more workers left the workforce, most notably for retirement, than could have otherwise been the case. The MG Rover case was seen as a more successful example of policy intervention, with greater funding assistance available and targeted support available, and with more emphasis on re-training needs to assist adjustment. However, despite the assistance offered and the rhetoric of successful adjustment in both cases, the majority of workers have nevertheless experienced deterioration in their circumstances particularly in the Australian case where casual and part-time work were often the only work that could be obtained. Even in the UK case, where more funding assistance was offered, a majority of workers reported a decline in earnings and a rise in job insecurity. This suggests that a reliance on the flexible labour market is insufficient to promote adjustment, and that more active policy intervention is needed especially in regard to further up-skilling.

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Divisions: College of Business and Social Sciences > Aston Business School > Economics, Finance & Entrepreneurship
College of Business and Social Sciences > School of Social Sciences & Humanities > Aston Centre for Europe
College of Business and Social Sciences > Aston Business School
Additional Information: This is an Author's Accepted Manuscript of an article published in Armstrong, K., Bailey, D., de Ruyter, A., Mahdon, M., & Thomas, H. (2008). Auto plant closures, policy responses and labour market outcomes: a comparison of MG Rover in the UK and Mitsubishi in Australia. Policy studies, 29(3), 343-355. Policy studies 2008 © Taylor & Francis, available online at:
Uncontrolled Keywords: plant closures,labour market outcomes,policy responses,job quality,well-being
Publication ISSN: 1470-1006
Last Modified: 16 Jul 2024 07:04
Date Deposited: 18 Oct 2013 08:48
Full Text Link: http://www.tand ... 442870802160051
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PURE Output Type: Article
Published Date: 2008-09
Authors: Armstrong, Kathy
Bailey, David (ORCID Profile 0000-0002-1956-0556)
de Ruyter, Alex
Mahdon, Michelle
Thomas, Holli



Version: Accepted Version

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