Bucking shift to Continent, IBM ups Scottish operation
Edinburgh — Concern about American-owned companies in Britain switching production from U.K. factories to the Continent, where labor is cheaper, has been somewhat eased by the decision of International Business Machines (IBM) to put an additional (STR)8 million ($12.1 million US) into its (STR)100 million ($151 million) investment at the Clyde estuary port of Greenock.
The new investment at Greenock, chosen from 13 IBM factories in Europe, is a significant boost for Scotland's fast-developing computer and technological industries. Many of the thousands of personal computers being made under the latest range of business machines will be sold to Common Market countries, the Middle East, and Africa.
The computers being made in the new range cost (STR)3,000 and were first marketed in America and Canada in 1981.
IBM's Greenock plant, which has built up its labor force from 250 to 2,500 within the past 30 years, has had a history of steady development and has been without strikes. Although the trade unions in the area have strongly regarded the nonunionized plant as a threat to general trade union recruitment, the news of the latest development has pleased labor and civic leaders in their desire to see more jobs brought into a region of high unemployment.
The government has put (STR)2.5 million toward IBM's latest investment.
IBM's growth will mean around 300 jobs for Greenock.
But British unions are increasingly disturbed about US companies transferring plants to countries like Spain. The giant Transport and General Workers' Union has complained about General Motors concentrating car production at Zaragoza and passing over U.K. Midlands factories in the production of right-hand-drive cars.
British union officials, who claim that Spanish car plant employees earn only around general labor rates of (STR)80 weekly, have threatened to block General Motors imports to Britain.
Apparent moves by international companies to move the mass production of modern cameras and computers overseas have angered the unions in the northeast city of Dundee.
The belief that the city has been used as a ''guinea pig'' for two large companies intent on the exploitation of camera production in Japan and computer development in Portugal is not confined to union officials, but appears to be shared by a significant number of business people. There has been great concern in Dundee about what is seen as the exploitation of local workers in the fierce international competition to mass-produce cameras and computers of the most up-to-date design.
Company managements have denied any intention to switch production substantially.
American companies have been charged with obtaining large government grants and then moving out of Britain once profits were made and overseas labor appeared cheaper.
Yet IBM's loyalty to its work force at Greenock - which is not an isolated instance of steady US investment in certain Scottish areas - has taken the edge off some anti-American feelings.
The impending visit of US mining company officials interested in learning about oil shale industries near Edinburgh may help to cement some tarnished Scottish-American business relations. The shale mines closed here a long time ago, but some mining companies in America's Midwest appear eager to learn how best to develop vast supplies of the oil in the US shale belt.