On the day Government figures suggested a tentative recovery in the labour market, 147 job losses were announced at a Kerry textiles factory and the future of a further 120 was thrown into serious doubt.
Sports Socks Ireland will cease production in Cahirciveen from the end of September and it put staff at a sister operation in Tralee under protective notice while the firm's direction is "re-evaluated".
Blaming a slack market and rising costs, management said the Cahirciveen plant, which produces Wilson sports socks, had become unsustainable. Closure has been regarded as inevitable by many staff since the breakdown of takeover talks between Sports Socks' US owner, Kellwood, and a potential Israeli buyer.
Kellwood, which only acquired the business last year, is keen to sell up and has been touting Sports Socks for several months. Sources indicated the survival of the Tralee factory hinged on fresh investors coming on board in the near future.
Established in 1990, the business has been running up losses for several years. Originally owned by babywear manufacturer Gerber, it was sold to Kellwood last year. Last March, staff were put on a two-day week.
Management and unions will meet this morning to begin negotiating redundancy packages. Twenty one administrative employees in Cahirciveen will continue to work under protective notice.
Mr Stephen Barter, general manager of Sports Socks, said: "The company regrets having to make this decision and acknowledges the contribution of employees over many years and their flexibility in meeting its fluctuating workloads over recent months."
He added: "This decision in no way reflects on the individual performance of staff but is as a result of ongoing unsustainable business losses caused by increased costs and reduced customer demand."
The Tánaiste, Ms Harney, said the closure was a "disappointment".
"Every effort was made to save the jobs. The company had been in negotiations about a takeover but unfortunately this did not materialise. I am disappointed with the announcement and I wish to express my sympathy with the workforce and their families at this difficult time," she said. "Clearly finding alternative employment for these workers is a priority."
