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Easy come, too easy go

Factory closures demonstrate that raising standards does not guarantee prosperity. We need to place obligations on the multinationals who use our skilled workforce, says Frank Coffield

The closure of one micro-chip plant could be dismissed as a costly aberration, but the closure of two - coupled with this week's threat to Philips' TV tube factories - appears to be the start of a worrying trend.

The decision of Siemens and Fujitsu to shut down may be a turning point in the history of the North, but only if the appropriate lessons are learned. Their withdrawal has more than local significance as there are more than 30 such factories in the UK. When high-tech factories arrive and disappear as quickly as football managers, the world has become seriously unpredictable. David Bell in his recent article on the Siemens closure ("The microchips are down", TES August 21) rightly argues that the blame for the collapse cannot be laid on a "feckless, under-developed workforce", and yet he pleads for more investment in education. If the level of skills was not the problem, how can it magically become the solution?

All the North's 16-year-olds could have obtained five As in the GCSE exams, all its teachers could have MEds in school improvement, and all its directors and professors of education could have PhDs in robotic technology and still Siemens and Fujitsu would have closed.

The debate must move beyond the simplistic notion that raising standards in education will of itself create economic prosperity for all. Raising skill levels is not the key to the promised land; it is a necessary but not a sufficient condition for such success. The first lesson to be learned is that each region in the UK needs an economic strategy, closely integrated with plans for education and training. For the past 30 years there has been no economic strategy of any kind for the North, never mind a plan which dovetailed future skill needs with levels of education and training. This could be achieved without education becoming a mere instrument of the economy.

Over-concentration on raising skill levels puts the onus for change and economic success on education and takes the pressure off industry. Just as industrialists have realised that education is too important to be left to teachers, so we in education must argue that the economy is too important to be left to industrialists and politicians. All our futures are at stake, so there needs to be a robust public debate about the causes of these closures (overproduction, Asian recession, strength of the pound, high interest rates, and so on), before new plans are implemented or the old practice of laissez-faire is reinstated.

Support is now universal for partnerships between schools and industry, but these may become more productive if education had demands to make of industry. Unions such as Unison argue for legislation to oblige employers to develop policies on learning at work, for example establish learning committees with representation from management and workers, develop learning agreements, laying out the rights and responsibilities of both parties, and require employers to account for their investment in learning in annual reports.

Meanwhile, a series of questions cries out to be answered about these closures: why did Siemens shut down its British micro-chip factory when it has similar plants in Taiwan, France and Germany? Probably because the British market is so deregulated that foreign investors can move out as easily as in.

What commitments were these firms obliged to make to their employees and the local community in return for the millions in subsidies from British taxpayers? Is Siemens being required to return the Pounds 50 million to help cope with the turmoil it has caused? The second lesson is that politicians need to drive harder bargains with multi-nationals to protect the long-term interests of British workers and communities, and Government needs to redress the imbalance which the Tories intensified between labour and capital.

Insisting on a tougher stance with foreign investors may, however, drive them towards competitors - either other UK regions or within Europe. It might have been more fitting if the hopes of workers in, say, Bayern had been raised and then dashed, but visiting the effects of massive management miscalculation on another group of workers is no advance.

Local authorities, understandably anxious to alleviate unemployment, who out-bid each other by offering "sweeteners", are simply playing into the hands of inward investors. It will take concerted action by a regional power bloc, for example, the European Union, to stand up to the predatory behaviour of multi-nationals.

The third lesson is that the North's reliance on inward investment as the response to the closure of "older" industries has proved to be too risky. The new regional development agency needs to introduce a policy of economic diversification, to insist on inward investors making long-term commitments to employees and the locality, and to attract manufacturers of advanced rather than basic products, with in-house research and development. Instead of the profits of Northern labour being remitted abroad, British capital should be energetically encouraged to invest in manufacture in this country.

Failure can be more interesting than success and it is a mark of a learning society to debate and learn from such painful failures as these closures. The outcome may be better ways of coping with uncertainty and complexity rather than a retreat into comforting myths of the kind which suggest that education alone can create economic prosperity and social justice for all.

Frank Coffield, professor of education at Newcastle University, is director of the Economic and Social Research Council's The Learning Society programme (1994-2000). He writes here in a personal capacity.

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