THE gloom around the Sweater Shop factory in Cumnock was palpable yesterday as the workforce pondered an uncertain future in an industry they hoped would expand and help relieve the chronic unemployment in the area.

As members of the team of receivers from Price Waterhouse worked their way through the books at the company's main plant in the Ayrshire town, the workers continued with the production which has been going on for more than five years.

Yet it seems that a buyer for the factory and its specialised machinery may be hard to find as the textile industry goes through its worst phase for two decades.

The workforce at Cumnock will be told this morning who is to face immediate redundancy and if production at the factory can continue into next week.

Those that remain must live with the fear that the whole group may face collapse, bringing down the five manufacturing plants and 78 shops as well as throwing more than 1300 people on the dole.

There was a mixture of frustration and anger as the workers took their lunch break under a fittingly grey Ayrshire sky yesterday.

Machinist Jean McLean, 48, who has been with the company for four years, spoke for her fellow workers when she expressed her frustration at not knowing what the future holds and anger that the situation has become so grave.

She said: ''This was a great place to work at the start and there was a real buzz about it. Over the last year and a half, though, we have seen changes and the atmosphere has changed with it.

''On one occasion the wages did not go into the bank until late and we began to have fears about what was happening. We have done our best to keep the quality of what we make up to a high standard but there seems to have been a combination of the company stretching itself too far and folk in the shops just not buying the goods.''

Like the rest of the workforce, which has slipped from a peak of around 400 to 270 in the past two years, she must wait and see what the future holds.

Many of the workers are angry, too, at an apparent threat to their holiday funds which are gathered from their wage packet each week. Mr Robert Cargill said: ''That is our money but so far we have only heard that it is not guaranteed and we may have to claim it later. That doesn't help someone who has a holiday booked when the factory is supposed to take the summer break. In fact, some that go out the door could end up with nothing.''

The workers were baffled at reports that the strong pound may have hit this sector of the industry as most of the raw materials and the markets for the finished products are in the UK.

There was hollow laughter, too, at news that a national minimum wage of #3.60 an hour had been put forward. One worker said: ''There's folk in there that would be delighted with wages like that. We know that they are paying some younger staff less than #3 an hour so they cannot blame high wage costs for the problems.''

There was swift political reaction to the crisis with local MP George Foulkes seeking a meeting with the joint receiver Richard Rees to discuss the future. He said: ''This is a potential disaster for a town like Cumnock where unemployment is already running at totally unacceptable levels.

''I will be working closely with the receivers, East Ayrshire Council and Enterprise Ayrshire to ensure that everything is done to find a buyer for the factory and save as many jobs as possible.''

Council leader David Sneller said: ''It will devastate the community if this important employer goes down. We had hoped that Sweater Shop would at least consolidate, if not expand, in Cumnock and this has come as a very unpleasant surprise. We are seeking urgent talks with Industry Minister Brian Wilson to find out if he can help save the jobs or at least cushion the blow.''

Mr Iain Bennet, of Price Waterhouse, said that a high cost base and tight margins had meant that the rapid expansion of the company had been financially unsustainable.

He added: ''We believe that the shops and staff may prove attractive but that the manufacturing operation may be more difficult to sell.