Tata cuts could push redundant workers into debt

In recent months, one piece of good news for many people has been the increase in jobs in the UK economy. This has been an apparent paradox as it has …

In recent months, one piece of good news for many people has been the increase in jobs in the UK economy. This has been an apparent paradox as it has occurred in a recession, running contrary to accepted economic theory.

However, it has not all been good news. There are still instances of redundancies and jobs being lost. Ask steel workers at Tata.

The company has announced what it calls "restructuring proposals" regarding its UK operations. In practice, this means upgrading some plants and reducing operations elsewhere, with consequences for employment levels. And in this instance, the outcome is the net loss of 900 jobs.

Of these, the bulk will hit those working at Port Talbot and Llanwern in Newport, leading to 580 job losses in south Wales. This compared with 155 in Yorkshire, 120 in the West Midlands and 30 in Teesside.

Chief executive of European steel operations at the firm Karl Kohler said: “These restructuring proposals will help make our business more successful and sustainable, but the job losses are regrettable and I know this will be a difficult and unsettling time for the employees and their families affected." He added that the firm will be seeking to support job creation efforts in the affected areas.

Job losses are known to be a common cause of debt problems, with some people going from a position of being able to service their monthly repayments from their salaries to being unable to pay due to the sudden plunge in salary.

For those who do lose their jobs, seeking debt help at an early stage is important, as the sooner a problem is tackled the easier it will prove to resolve.

Between July and September 2012 a total of 128,000 people were made redundant in the UK. For those living in south Wales, the problems of getting back into work may be greater than elsewhere. Blaenau Gwent has the highest jobless rate in Wales at 14.4 per cent, with Merthyr Tydfil, Rhondda Cynon Taf, Torfaen, Caerphilly and Newport all having unemployment rates of ten per cent or more.

But whether the local employment situation is better or worse than the national average, those faced with being unable to pay their debts will be wise to seek assistance as soon as they can.

By Joe White

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