INITIAL estimates of the employment impact of the Ravenscraig closure

were far too high, according to a computer analysis carried out by the

Fraser of Allander Institute.

It had been claimed in the wake of Wednesday's announcement by British

Steel that, on top of the 1220 direct job losses at Ravenscraig and the

Hunterston ore terminal, another 15,000 to 16,000 people in Scottish

companies supplying the steelworks also would lose their jobs.

However, the institute's forecasters, using their

medium-term model of the Scottish economy, put the knock-on figure at

5580 jobs between now and 1996. They also calculate the impact of the

loss of steel production on economic output at less than 0.5% of the

Scottish Gross Domestic Product.

The figure on job losses is based not just on the closure of

steelmaking at Ravenscraig but also on the earlier shutdown of the

plant's hot strip mill and on the recent closure of the Clydesdale tube

works. In total, the direct job losses from all three total about 4400


''We might be a thousand jobs out,'' says the institute's steel

industry expert, Jim Stevens. However, he points out that the 1988

Arthur Young study for Motherwell District Council put the total job

loss from the closure of the entire Scottish steel industry at between

11,000 and 12,000 jobs.

Further, even after the Ravenscraig announcement British Steel will

still operate the Dalzell plate mill, the Imperial tube finishing works

at Airdrie, and Fullwood foundry, employing, in total, about 1750

workers. In its calculations, the institute assumes these will endure

beyond 1996.

Production industries will bear the brunt of the job losses,

accounting for just over 82% of the total estimate of 9980 jobs. Most of

that will be in manufacturing, which accounts for 78.5% of the total

loss. The service sector, on this analysis, will lose 1510 jobs (15.1%)

and construction will shed 280 (2.8%).

While the overall impact of the Scottish economy is more muted, the

local impact is considerable. About 85% of the job losses are projected

to occur within Strathclyde region, with the main incidence of that

being within the Lanarkshire travel-to-work area.

The forecasters also point out that the closure is taking place at a

time when, in both Scotland and the UK as a whole, economic activity is

weak. The impact will be harder to absorb than it would have been if it

had happened in 1994 or later, when growth is expected to resume.