THE Thurgoona maker of plastic milk bottles for Murray Goulburn says the dairy giant’s Kiewa factory closure should not threaten its jobs.
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However, Australian Industry Group regional manager Tim Farrah reckons up to 40 positions related to the Kiewa plant are at risk due to the staged closure.
“If you lose 135 jobs at Murray Goulburn it would be very surprising if there were not another 30 to 40 jobs that were at risk or where people will be cut back from full-time to part-time or casual positions, because demand for those products take a hit,” Mr Farrah said.
“There’s more people looking to share a smaller pie, so a lot of industries and businesses, their viability starts to come into question.
“If you look at the transport sector, all those transport companies doing work at Murray Goulburn are now going to be looking elsewhere.
“They’re going to want potential customers and more than likely have to negotiate price.”
However, Thurgoona packaging company Snopak Manufacturing does not believe it will suffer job losses due to the Kiewa factory closing.
The firm has been manufacturing two and three-litre plastic milk bottles for Murray Goulburn for the past eight years.
Snopak site manager Peter Goddard said while the likely loss of business was a concern he did not believe it would necessitate cuts to his workforce of 20.
He said other contracts meant the company should have adequate work to cover a loss.
Mr Farrah said the move to cut Murray Goulburn’s ties to Kiewa was a shock.
“I don’t think anyone really saw this coming, not for a complete shutdown, especially when you look at fairly recent history of Murray Goulburn,” he said.
“Over the last five years they’re been a strong business, certainly they’ve had pressure in the last couple of years, but traditionally they have been a solid business.
“It highlights how fragile the Australian economy is, demand is still soft, profit margins are thin and there hasn’t been wage rises in the private sector for some time.”
Mr Farrah said the Ai Group would be speaking to Murray Goulburn bosses on the closure and talking to federal government representatives about why it has happened.
He said policies were needed to assist business.
