The collapse of engineering company Hastie promises to put added stress onto the entire sector. With more than 2000 jobs expected to be lost due to the company bankruptcy, the number of sector job losses is further compounding.
The Canberra Times Business Day reports 500 engineering job losses from Qantas (in the majority from Victoria’s Tullamarine), with Caltex also intimating a shut down of two of its oil refineries next year.
All of these developments will mean for a very difficult circumstances in the engineering sector, especially for those in the states of Victoria and New South Wales.
It has been estimated that Hastie’s debt has now increased to $500 million after posting a December-half loss of $150 million. They have since reported a $20 million accounting discrepancy, which will be handled by the Australian Securities and Investments Commission.
In a statement from the company’s receivers and managers, McGrathNicol, they have promised that even though Hastie have entered into voluntary administration, most operations will at present ‘continue to trade as usual’.
“I would like to assure customers and employees that our appointment allows the Spectrum, Services, Gordon Brothers and Austral businesses to continue to operate with minimal disruption while we run an orderly sale campaign for each business,” says company partner, Peter Anderson. “We do not expect to make any significant structural changes to the businesses or their workforces.”
However, while assurances have been made regarding certain workplace structures, one area of the business is expected to feel the hit of the losses the hardest. Hastie’s Mechanical, electrical and plumbing units both nationally and in the Middle East will not receive the same ‘smooth running’ prognosis.
”There are insufficient funds to enable the Administrators to operate the MEP companies,” say the voluntary administer PPD Advisory. “Regrettably the Administrators have no option but to suspend operations whilst they assess the financial position of each company.”
Trouble in the sector already, pre-carbon tax implementation, is not a good sign for engineering Australia. The coming months will test the industry facet even further, with increased job losses a valid fear.