Welcoming Ryanair back to Manchester?
Article published: Sunday, July 17th 2011
Ryanair announced this week it would be investing £175m at Manchester Airport, creating new jobs and opening routes to new destinations. There was much excitement in the local press, but with so much pinned on private sector job creation the figures demand closer attention.
On Tuesday, the chief executive of Irish carrier Ryanair, Michael O’Leary, gave a press conference at Manchester Airport to announce a massive £175m investment plan. From October Ryanair will have two aircraft flying to 17 destinations from Manchester, rising to four planes to 26 destinations by the summer of 2012.
The Manchester Evening News headline the following day read ‘Ryanair to invest £175m and create 2,000 jobs at Manchester Airport’. Given the current state of the British economy and the scale of public spending cuts locally, 2,000 new jobs in Manchester would be quite a boon for the government, as well as politicians and businesspeople arguing that private sector growth will quickly fill the employment gap left by job losses in the public sector.
However, the figures in the MEN – and reported in the national press – appear to be misleading. Ryanair’s press release states that the airline’s “2m passengers [per annum] will sustain up to 2,000 jobs at Manchester Airport and in the surrounding region”. TheBusinessDesk.com noted the airline will actually only “directly employ 250 people… when all 24 routes are operational”.
O’Leary said this could rise to 450 if plans to expand to 40 routes the following summer come to fruition. A fact which was unsurprisingly missing from Ryanair’s press release, but also from the media coverage, was that when the airline pulled out of Manchester 18 months ago after a spat with airport chiefs, it axed around 600 staff. That means even if there are 40 new routes in two years time, there will still be 150 fewer jobs than in 2009.
‘Sustaining’ jobs
The aviation industry has a reputation for exaggerating for commercial gain the benefits it brings to local and national economies – more so than other sectors. While much debate over recent years has revolved around the environmental impacts of aviation, job creation has long been a bone of contention during expansion plans.
Ryanair’s press office could not be contacted to clarify how the 2,000 figure had been arrived at or which jobs were included within it. It seems probable, however, that rather than any calculation taking local circumstances into account, the company simply used the often-cited – yet dubious – figure that every million passengers in the aviation industry supports 1,000 jobs.
‘Sustaining’ or ‘supporting’ 2,000 jobs is very different from employing 2,000 staff or creating 2,000 jobs. The aviation industry usually uses an economic forecasting model for job creation which includes ‘indirect employment’ and ‘induced employment’. The model is heavily disputed as an accurate indicator of an industry’s economic impact based on “dubious statistical concepts”, according to Brendon Sewill, a former advisor to the Treasury and the British Bankers Association, and author of ‘Airport jobs: false hopes, cruel hoax’.
It tends to double-count jobs across industries, such as including construction workers at airports and oil workers who have already classified as employed within their own sectors. It also produces some unlikely results over whose employment is ‘supported’ by aviation activity – a process which could logically carry on indefinitely.
Because of this the calculations themselves are often wildly optimistic using questionably high multipliers. When Manchester Airport built its second runway – after a long and bitter dispute with local residents and environmental campaigners – it was justified largely on a claim first made in 1991 that 50,000 jobs would be created. The figure was revised during a public inquiry to 18,000, which still included indirect and induced jobs, as well as jobs in firms that would relocate to the area from elsewhere.
The media continued to use the 50,000 figure, as did the airport chief executive in 1997 when planning permission was granted. The runway was built and opened in 2001. According to Sewill, by 2006 Manchester Airport employed 4,000 more staff than 10 years earlier. Adding indirect and induced jobs at the ratios usually quoted by the aviation industry, the increase would have been 6,400 in total.
Questionable claims
There is little information on what jobs will be created by £175m of investment other than there would be 250 and they would include “pilots, cabin crew and auxiliary staff”. One thing for sure is that staff will not be encouraged to seek worker representation. Ryanair has always been doggedly anti-union, and continues to operate a policy of refusing to deal with trade unions.
Manchester Airport Group’s CEO Charlie Cornish said back in February that budget airlines such as EasyJet, Jet2 and Ryanair are crucial to MAG’s drive to increase passenger numbers and profits. Airport chiefs and local politicians argue in turn that passenger growth will drive expansion and lead to the creation of thousands of new jobs. This is central to the development of Manchester Airport City, the recently designated Enterprise Zone, itself one of the major pillars of the council’s future regeneration strategy. The Airport City draft consultation document suggests that up to 15,000 jobs may be created by the development.
According to Regeneration and Renewal, the Department of Business, Innovation and Skills has no means of verifying the job creation claims made in bids for the Regional Growth Fund – to which MAG Developments recently applied for £10m to accelerate Airport City. The figures were basically taken at face value. It is hard to imagine that none of them were over-inflated. The same is rumoured to be true for the Enterprise Zone bids within the Department of Communities and Local Government.
Meanwhile the first independent analysis of Enterprise Zones by SQW says job creation expectations are “questionable” and the timescales “very optimistic”. Given the ambiguous, if not deliberately misleading, nature of the figures pumped out by the aviation industry and politicians – regurgitated without question by the vast majority of the media – their claims should clearly be treated with the utmost scepticism.
Andy Lockhart
More: Features, Local economy
Comments
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Something not as good as its hyped up to be shocker!
Don’t worry Andy, the people are quite used to such stories. We get them all the time, often from the government about its mediocre public services.
Comment by simon on July 18, 2011 at 4:22 pm -
[…] here: Welcoming Ryanair back to Manchester? — MULE […]
Pingback by Welcoming Ryanair back to Manchester? — MULE | my Manchester News on July 19, 2011 at 1:47 am -
Excellent article. This should provide campaigners – and concerned city residents – with ammunition to tackle the Councils relationship with the Airport, especially as it is constantly held up as an economic hub that can provide jobs while its environmental impact is swept under the carpet.
Comment by Michael Pooler on July 25, 2011 at 8:19 am -
Have people also heard about Ryanair’s scam recruitment and training which is seeing people well out of pocket?
There is more ifo on the campaign site:
Comment by Mike on July 27, 2011 at 6:14 pm -
Rooftop protest by John Foley at Liverpool Airport against Ryanair’s practices.
Comment by Mike on August 24, 2011 at 6:00 pm -
[…] of its jobs will “remain in Manchester city centre”. Such claims also have a bad habit of being inflated, while bringing highly uneven benefits to lower-income […]
Pingback by News round-up 5 – 9 September — MULE on September 12, 2011 at 12:07 pm
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