UPDATE: More than 1,000 jobs have been lost in the North East as multiple businesses collapsed throughout 2025, with hundreds more at risk as factories face imminent closures in 2026. This devastating wave of job losses is attributed to rising costs, declining demand, and the ongoing impact of US tariffs.
Among the most significant casualties is Merit Group, a once-thriving construction firm in Cramlington that went into administration in November, resulting in the loss of over 340 jobs. Merit was known for its modular building projects, including a major £35 million healthcare facility in Northumberland, now under new management after its collapse.
In Peterlee, NSK Bearing and AKS Precision Ball announced a consultation process that could threaten 350 jobs. The Tokyo-based company cited “persistent challenges” in profit margins for local manufacturing, with plans to close operations no later than March 2027. This closure will affect the production of essential components for major automotive brands like Volkswagen and Renault.
The steel industry is also feeling the pinch. Union Electric, based in Gateshead, closed its doors earlier this month, resulting in the layoff of 156 employees. The firm, formerly known as Davy Roll, was placed into administration by its US owners due to mounting losses and intense overseas competition.
Another heavy blow came from Zytronic, which announced an orderly wind-down of its operations in February. The company, which employed around 50 people, struggled to recover after a key US customer filed for Chapter 11 bankruptcy, further exacerbating its financial woes.
In Teesside, over 270 jobs were lost following the collapse of chemicals firm Venator. Administrators from Alvarez and Marsal were appointed last month to manage the affairs of the company, which is now under scrutiny as it navigates the fallout from its parent group’s insolvency.
Furthermore, at least 100 jobs are at risk following the announced closure of Sabic’s long-standing chemical site in the North East. The Teesside Olefins 6 plant, operational for 46 years, has been dormant since 2020, and plans for its conversion have stalled due to shifting market dynamics.
The job crisis extends beyond manufacturing as Energy Compare closed in March, leaving 120 employees without work. Fortunately, rival company Betr Outsourcing stepped in shortly after, rescuing 100 jobs by integrating former staff into its own operations.
The legal sector faced its own shock when Samuel Phillips Law suddenly closed its doors after more than a century of service. The firm, founded in 1919, is now under investigation by the UK legal watchdog for “suspected dishonesty”, leaving former employees stunned and seeking answers.
As the North East grapples with these unsettling developments, the urgency for economic support and recovery strategies grows.
What’s Next: With several businesses in the region still at risk of closure, industry leaders and local authorities are urged to implement measures to safeguard jobs and stabilize the economy. Watch for updates on ongoing consultations and potential rescue plans in the coming weeks.
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