The effect of external takeovers on manufacturing employment change in the Northern region between 1963 and 1973

Abstract

Smith I. J. (1979) The effect of external takeovers on manufacturing employment change in the Northern region between 1963 and 1973, Reg. Studies 13, 421–437. This analysis attempts to assess the differential employment performance of externally acquired manufacturing plants with over 100 workers in the Northern region. The evidence for regarding this ownership category as potentially a distinctive one in terms of employment performance is first reviewed. It is hypothesised that such plants may be characterised by above-average employment growth in the pre-merger period, and that subsequently this growth rate is curtailed as a result of the takeover. All large manufacturing plants in the region are then classified into three main ownership categories, so that their employment performance between 1963 and 1973 can be compared: those controlled from within the region (the indigenous sector); those formerly controlled from within the region (the externally acquired sector); and those whose locus of ultimate control is external to the region (the non-regional-branch plant sector). The traditional components of employment change analysis is then modified to allow for transfer of employment between the categories as a result of acquisition. The results provide some support for the hypotheses advanced in the introduction, although inadequate employment data makes the conclusions necessarily tentative.