This factory once made every single Rolo in the world. Its decline is a warning for UK’s leaders

If you’ve ever eaten a Rolo, chances are it came from the production lines at Nestle’s factory in Fawdon, in the north-west of Newcastle. Since it opened in 1958, workers at the Fawdon factory produced the Fruit Pastilles, Toffee Crisps, Munchies and Mini Eggs, which ended up under the newsagents’ counters of Britain.

That was, until the start of this year, when Nestle shut the factory down, taking almost 500 jobs with it. Like any famous chocolate factory, it serves as a cautionary tale – although in this case, one of the perils of politicians neglecting to plan how we make stuff.

“A lot of the workforce were not just impacted by the personal impact on them individually, but on the community,” said Charlotte Brumpton-Childs, a national officer with the GMB union, who helped negotiate an exit package for factory staff.

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“The factory has been there for a really long time, and there are no comparable jobs in the area – especially for those that maybe didn’t have formal qualifications. So there really was a sense of, if we let these jobs go out of our community, what’s going to replace them?”

‘It’s the most generous closure package I’ve ever negotiated’

Nestle decided to move production to other sites in the UK – and to Poland, Bulgaria and the Czech Republic. It said its decision was not motivated by Brexit or supply costs – instead a choice to “create a more efficient manufacturing footprint”. Fawdon, Brumpton-Childs said, was a heavily unionised workplace, with staff earning an average of £45,000 a year, in an industry where similar non-union jobs might pay just above minimum wage. After closure was confirmed in 2022, and 573 people put at risk of redundancy, GMB members decided not to strike to try and save the factory, instead prioritising better terms for the shutdown.

“It’s quite a unique situation when you negotiate with companies like Nestle over things like factory closures, because it’s not that the company has got no money, and that’s why the jobs are being lost. It’s because they’re making commercial divestment and investment decisions,” Brumpton-Childs said.

Some workers were close to retirement, and were able to retire with the help of “quite a generous redundancy payment”. Others were helped to explore opportunities at other Nestle factories, including Halifax and York. Those who didn’t fall into either camp ended up with a “decent financial cushion”, and some were given 18-month secondments to other Nestle sites while they looked for new jobs. Nestle said everybody was given the opportunity to move to a different site, but that the vast majority left the business entirely.

Newcastle City Council also stepped in, convening a task force which its deputy leader Karen Kilgour said “successfully managed to support and retrain many employees into new roles and minimise the number of job losses, while also facilitating the sale of the site to a new operator”.

“It’s the most generous closure package I’ve ever negotiated as a national officer,” said Brumpton-Childs. Workers, she said, were able to leverage the fact negotiations were taking place early, and that decent terms could keep morale and attendance high right until the end.

‘We’re starting to feel the pain’ of the UK’s lack of direction on industry

The jobs at Fawdon were just a few of the near-200,000 manufacturing jobs lost in the UK since 2010 – working out at 6.7% of the total jobs in the sector. On a longer view, the UK’s economy shed over 6 million jobs from the mid-1960s, with the north and the midlands hit hardest.

“The sad state of affairs in UK manufacturing means it’s not the only place we’re having these conversations,” said Brumpton-Childs.

Jonathan Reynolds, the new Labour business secretary, has promised a new industrial strategy in the coming weeks. Sick of losing out on investment to France, Spain and other countries, Reynolds told the FT “many businesses tell us it is too hard to invest in the UK”, and said he would outline a plan before 14 October.

But time is ticking for factories across the UK. Up to 6,000 job cuts are imminent in the UK’s steel and oil refinery industries, including 2,800 jobs in Port Talbot. Harland & Wolff, the shipbuilder which made the Titanic and continues to employ workers at shipyards in England, Scotland and Northern Ireland, battles with insolvency and administration.

“If we don’t get policy and procurement decisions made soon at a UK government level, then we’re going to see manufacturing continue to shrink,” said Brumpton-Childs. “We’ve not had an industrial strategy, at least over the last two successive governments, and we’re starting to feel that pain now.

“There’s not a cohesive approach to supporting and creating jobs in the UK manufacturing industry, or training people for the skills needed to run a successful and productive manufacturing industry.”

Professor Abigail Marks, of the University of Newcastle’s business school, added: “The government has not been helpful in re-energising the north east and we know there are still high levels of labour inactivity and high levels of poverty, particularly childhood poverty.

“Investment needs to be made in both manufacturing – we need, as a country, to make more both for economic purposes and for enviromental reasons – and in digital so people have greater access to work – including remote work.” 

What’s the future of manufacturing in Newcastle?

After the closure, production largely moved to Halifax. Country Style, a local bakery firm, bought the Fawdon site.

“It is symbolic of continued de-industrialisation in the north east of England – in other parts of the UK de-industralisation has halted. It is a fairly tough outcome for workers in the north east,” said Marks, adding that the closure could have knock-on effects on suppliers and the community, resulting in a domino effect of other businesses closing.

Unemployment in Newcastle sits at 5.3%, compared to the Britain-wide average of 3.7%. Economic inactivity – the number of people aged 16-64 not looking for a job – is 24%, against a national average of 21.2%. The days when the north east was the industrial powerhouse where half the world’s ships were made are long gone – Tyneside’s last shipyard closed in 1993.

But hopes remain for new, more modern industries. Kilgour said she believed the creation of the new North East Combined Authority would bring “further opportunities for our region to flourish in a variety of sectors such as bio tech, life sciences, digital, advanced manufacturing, renewable energy and the creative and cultural sector.”

Computer microchips could take root in the region. Although few seriously talk of the Tyne becoming Tyne-wan, the government has marked the north east as a potential hotspot for the manufacturing of semiconductors. Civil servants are making their way north, with the government moving 400 jobs to Tyneside and promising 350 more by 2025.

Buy a packet of Rolos now, and there’s little hint of Fawdon’s legacy: the packet simply reads “Made in UK”.

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