The news, which comes barely two weeks after the company announced record profits of 28 billion kronor, was greeted with dismay by unions.
“We had no idea that this was going to happen,” said Christer Söderström, chairman of the local branch of the Metall union. “A few weeks ago the management was saying how well everything was going.
The closure is a further blow to Nynäshamn after the decision by the government to close the Muskö military base in the town, with the loss of some 700 jobs. It is also likely to reawaken anxiety among Ericsson employees, where 8,000 jobs have been cut in the last two years. There were hopes that news of the company’s large profits would signal an end to closures at the company.
Göran Johnsson, national leader of Metall, said that when Ericsson CEO Carl-Henric Svanberg called him to warn him about the redundancies, “I told him that this would lead to a great deal of turbulence, given the large profits and dividends that had been handed out to shareholders.”
Kurt Jofs, deputy CEO of Ericsson, said that he could understand resentment at the closure when things were going so well for the company. But he added that Ericsson was operating in a “competitive world” and “our future hangs on decisions we make today.”
But Johnsson told Sveriges Radio that Ericsson should at least keep parts of the factory open for a while, to give people a chance to “wind down”.
“There’s too much emphasis on the share price and dividends, and not enough emphasis on social responsibility,” he added.
For the government’s part Hans Karlsson, minister for working life, called on Ericsson to take its responsibility for the people losing their jobs in Nynäshamn. He also reminded the local employment offices of their duty to provide the necessary resources to help those hit by the closure.
But he said that there was no need for the government to take special measures to help find jobs for those affected. He pointed out that Nynäshamn was within commuting distance of Stockholm, and was therefore better equipped to absorb the redundancies.