International Journal of Manpower,
Vol. 20 No. 7, 1999, pp. 458-468.
# MCB University Press, 0143-7720
Received December 1998
Accepted May 1999
Manpower factors and plant
closures in multiplant firms
Sheffield Hallam University, Sheffield, UK, and
Suzanne Richbell and Doug Watts
Sheffield University, Sheffield, UK.
Keywords UK, Plant, Location, Closure, Downsizing, Employee relations
Abstract The runaway shop (a plant closure to avoid labour problems) has been seen as a
feature of industrial change in the USA. Evidence of the runaway shop has also been noted in the
UK. This paper analyses two data sets from the UK. The first, drawn from data relating
primarily to the early 1980s, demonstrates that manpower difficulties can affect the closure of
plants in multiplant manufacturing firms in particular local labour markets. A second data set,
relating to the latter half of the 1980s, presents a contrasting result in that manpower problems
had little effect on the closure of plants by British multiplant manufacturing firms. It is suggested
these contrasting results may reflect the reduced power of organised labour in the more recent
Plant closures make an important contribution to the reduction of manpower in
the manufacturing sector in both Europe and North America and it can be
argued that plant closures may be associated with plants with manpower
difficulties. This paper explores the relationships between the manpower
characteristics of plants within a multiplant firm and the propensity of a plant to
close. The specific focus is on those plant closures where the multiplant firm
continues to manufacture the product of the closed plant at another of its
manufacturing sites. The paper excludes firm exits (through the closure of single
plant firms) and industry exits (where multiplant firms quit an industrial sector).
The discussion is in five parts. The first integrates research from a number of
disciplines to illustrate the causes of plant closures by multiplant firms and the role
of manpower problems in closure decisions. The second outlines the methodology
used in this study. The third and fourth parts report the results of a quantitative
analysis of two data sets. The fifth and final section considers the implications of
the findings which suggest that, in specific localities, it is possible to identify the
ways in which manpower difficulties can affect plant closures in multiplant firms.
Plant closures by multiplant firms
Analysis of the causes of plant closure does not appear as an important feature
in the literature of manpower planning despite the fact that plant closures make
a significant contribution to downsizing, especially at times of recession.
However, other subject areas provide insights that contribute to an
understanding of plant closures and the role of manpower considerations in the
closure decision. Three literatures have explored plant closures within
multiplant firms, one drawn from industrial economics, another from regional
economic development and a third from human resource management.