Redundant Dell IT workers to receive European cash

Dell laid off 2,000 workers in January 2009

The European Commission has approved a grant of €14.8m to assist 2,400 IT workers in the Limerick area of Ireland find new jobs.

The Irish government appealed to the European Global Adjustment Fund (EGF) for the grant in the wake of 2,000 redundancies at Dell’s manufacturing plant in Limerick – announced in January this year - and knock-on redundancies at Dell’s suppliers.

The government is adding additional funds to the package to bring it up to a total of €23m.

"When I visited Limerick last July and met with Dell workers, I promised to do everything to support those who lose their job,” said Vladimír Špidla, EU Commissioner for Employment and Social Affairs, in a statement.

“I am glad that today's decision will help former Dell workers to increase their skills and help them back into the labour market quickly."

The money will be used to offer redundant workers job guidance, support to set up their own business, training and retraining, an internship programme and education allowances and grants.

IT manufacturing is a big employer in the mid-west region of Ireland: Dell used to employ 3,000 workers at its Limerick plant, some 1.7 per cent of the local workforce, and local sources estimate up to 10,000 jobs are dependent on Dell’s precence.

The Limerick plant was focused on desktop PC assembly. But Dell filed a precipitous profit decline of 48 per cent in the quarter ended 31 December 2008, following a downturn in desktop sales of 23 per cent. The company announced a $3bn cost-cutting drive, including a change in manufacturing strategy away from desktops in favour of notebook and netbook models made for the company by Far Eastern contract manufacturers.

The EGF was created in 2006 to provide assistance for European workers who lose their jobs due to the impact of globalisation. It has since mutated to become a tool for economic stimulus to offset the affects of recession. There have been 27 applications to the fund for over €154m, helping some 33,300 workers. The Dell application is the first relating to the IT industry.

The grant has yet to be rubber-stamped by the EU Parliament and Council.