TEXTILES group Dawson International, which produces Pringle knitwear, yesterday signalled a large-scale redundancy programme which looks almost certain to see hundreds of its employees in Scotland axed.
The Borders and the Lothians, home to 2260 of Dawson's 3500-strong UK workforce, will bear the brunt of the job losses.
Dawson also put up a ''for sale'' sign, with chairman Derek Finlay saying that any bid approaches would have to be examined ''very carefully''.
An analyst at one Scottish stockbroker, who declined to be named, speculated that Dawson might be sold off in pieces.
The company plans to shift a significant proportion of its UK manufacturing to Continental European and Far Eastern locations.
Mr Finlay indicated that the heaviest cuts were likely to come at Pringle, which has already seen its workforce slashed in recent years and employs about 920 people in Hawick, Berwick, and Galashiels.
But wool-spinning subsidiary Laidlaw & Fairgrieve, which employs 620 people at Dalkeith, Gala, and Selkirk, also continues to struggle. Only last month, Dawson announced 83 redundancies in this operation.
Barrie Knitwear and Ballan-tyne Cashmere, which together employ about 720 people in the Borders and Lothians, could also see job losses.
Mr Finlay said knitwear was probably going to be hardest hit in the redundancy programme, but he also highlighted problems in wool-spinning.
He added that Dawson had to look ''very carefully and quickly'' at alternative manufacturing locations to remain competitive.
Dawson, which exports about 60% of its UK production, has been hit hard by the almost relentless surge of the pound against European currencies since the summer of 1996. This has made it easy for European competitors to undercut Dawson.
Mr Finlay said demand had ''shut down'' in the likes of South Korea, Thailand, and Hong Kong, which have been hit hard by the Asian financial crisis, and in Japan.
He declined to say how many redundancies there would be, but said workers would be told within weeks.
The analyst said: ''I think you must be talking about hundreds.''
Three years ago, Dawson shed more than 400 employees in Scotland and only last year it axed another 290 people at Pringle.
Mr Finlay said that orders secured by Dawson for the autumn season had been, in some cases, down by about 40%.
He expressed regret at the need for job losses, and believed that, when jobs went abroad, they would go permanently.
He added: ''It means the skill base will shrink. Clearly, it has local impacts that are very, very concerning to all of us.''
The news from Dawson is a further body blow to the Borders, which is facing its worst economic crisis in 30 years.
It has just seen more than 200 redundancies at the Selkirk and Galashiels plants of the American-owned printed circuit board manufacturers, Viasystems.
On Tuesday a survey of agriculture in the region revealed a 40% reduction in farm product incomes last year and forecast worse to come.
Neither Dawson management nor unions yesterday considered that the announcement of the proposed new #3.60 an hour minimum wage would further complicate a difficult situation, as pay levels in the industry are generally above the minimum level.
Borders MPs Archy Kirkwood and Michael Moore are meeting Dawson executives on Monday and will be pressing the case for aid for the Borders in a meeting with Scottish Industry Minister Brian Wilson later in the week.
As the jobs warning broke yesterday, GMB union regional secretary Robert Parker said: ''This is devastating both for the people who will lose their employment and because of the effect it will have on the economy of the Borders, which is already suffering on a number of fronts.
''We will be seeking an early meeting with Brian Wilson to see what help the Government can provide.
''The prospect of Dawson being taken over by new owners gives us cause for concern. In other similar acquisitions there have been job losses and if these come on the back of what is already being planned it will be appalling.''
An early hint of imminent action by Dawson came last Friday with the resignation after two years in the job of Pringle managing director Howard Gordon-Martin, the man who presided over December's redundancy programme.
Scottish Borders Enterprise chairman Tony Taylor, who is also chairman of the Scottish Textiles Association, said: ''We have been talking with Dawson about their problems over the past few weeks but the prospect of a buyer being sought for the firm is completely new.
''Winding up with the wrong sort of owner controlling a substantial slice of the Borders textile industry could create a major source of concern for us. On the other hand a good takeover could be positive.''
On the possibility of the proposed minimum wage adding to production costs, Mr Taylor said: ''It is not a major issue in the textile economy. Most companies pay above the minimum.
''The real problems are the strength of the pound, a general turndown in trade, and the disaster in the Far East.''
On the broader economic front, he said: ''As a rural economy, with textiles, electronics, and agriculture all suffering, the Borders has major problems.
''We have made our views well known both to the Scottish Office and Scottish Enterprise. We are pressing for more inward investment, European assisted area status, and the recognition that this is a very different kind of economy to the Central Belt.''
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