Workers at Fruit of the Loom have faced an increasingly uncertain future over the past year and news that managing director, Mr Andy McCarter, is set to leave the company will do little for morale. Some 2,500 staff are employed in Donegal, working between six sewing plants around the Inishowen Peninsula with the remaining 1,000 staff employed in the high-tech spinning plant in Derry. Last year, the removal of two of the McCarter brothers - Willie and John - and another Irish director from the board sent shockwaves through the company and created great insecurity among the workforce. The decision of the third member of the McCarter family - Mr Andy McCarter - to remain on at the company has provided some stability since. At the time of the upheaval, the company quickly moved to reassure workers and the Government that the jobs were safe, at least until the end of this year. However no long-term commitment was given to the Irish operations. As a measure of the concern for the Irish workforce, the Tanaiste, Ms Harney, has met with Fruit of the Loom chairman and chief operations executive, Mr Bill Farley four times this year. Her fears heightened before the summer, when she requested IDA Ireland to draw up an action plan to deal with up to 700 job losses at the Donegal plants. This plan will be dusted off again when the company gives a clear indication of its intentions.
The US T-shirt and leisure wear manufacturer has been in Donegal for almost 12 years since it took over the McCarter family's clothing manufacturing company in Buncrana.
The company expanded rapidly and quickly became one of Ireland's largest employers. Its decision to locate in the job-starved north west region was a major coup both for the McCarter family and IDA Ireland. Over the years, Fruit of the Loom internationally has seen its share of bad times in the notoriously fickle fashion markets. In recent years, with margins under pressure and sales slowing, the multinational corporation has had to take some very difficult decisions to ensure its survival and to keep its institutional investors happy.
Its response has been to seek out low-cost locations for labour intensive manufacturing. In the US, this has meant widescale closures and thousands of job losses as production facilities were transferred to the Caribbean.
Its Irish operations have managed to escape that fate so far, although it is becoming increasingly reliant on its sister operation in Morocco to produce low-cost T-shirts for the European market.
Some sources close to the company suggest that over the years plans to scale back the Irish operations have been drawn up, but have not been implemented. To some degree, this is thanks to the commitment of its Irish management team to the workforce. Another significant factor has been the insistence by the Republic and Northern Ireland industrial development agencies on a fully integrated operation between the two businesses in Donegal and Derry. By ensuring that the Derry operation spins the yarn which is then used in Donegal, the agencies sought to build in a safeguard, making it both difficult and expensive for Fruit of the Loom to move either of these businesses somewhere else. Mr Farley is due to visit Ireland in the coming weeks, when the situation will become clearer. However time seems to be running out for the T-shirt production operation and for the 700 workers employed in that section of its operations, while the future of the rest of the operations in Ireland remains unclear.
