The electronics industry in Dublin received a second major shock this week with the news today that contract electronics manufacturer Celestica is to shut down with the loss of 320 jobs. The closure follows news yesterday that Lucent Technologies was to reduce its workforce by 60 people. Both firms blamed the slowdown in the telecoms sector.
The collapse of the internet bubble in 2001 saw telecoms equipment makers slash spending, reduce manufacturing and reduce their workforces significantly over the past two years, as telecom firms that over invested during the bubble had to deal with surplus capacity and lack of cash.
Celestica, which made printed circuit boards for network switches and modems, began life in Swords in the mid-Nineties as Madge Networks before Celestica acquired the facility in 1998. At its peak, the facility employed around 1,000 people.
However, the prevailing winds of change that came with the bursting of the internet bubble saw contract electronic manufacturers such as Celestica getting hit the hardest. Customers in the telecoms equipment industry at present are opting for manufacturing in lower-cost economies, particularly the Far East and Mexico.
In terms of Lucent Technologies, the company has been gradually moving towards outsourcing its manufacturing division to lower-cost economies, resulting in yesterday’s announcement to shut down its Blanchardstown manufacturing operation.
Celestica has twice cut its workforce in Dublin and the closure announcement today will see the loss of 250 permanent jobs and 70 temporary jobs. Workers will receive six weeks pay per year of service as it winds down over the next six months.
By John Kennedy