Baird CLOTHING, based on the Skelton Industrial Estate, announced on Monday that 70 jobs were to be cut as part of restructuring plans.

The news comes as a huge blow to the area, which suffers from one of the highest rural unemployment rates in the region.

Coun Dave McLuckie, Skelton's representative on the Redcar and Cleveland Borough Council, said: "Seventy jobs in Skelton is a massive blow and there are a number of husband and wife teams there, so families will be losing all their income just before Christmas. The ramifications of this will be felt right across Skelton."

Coun David Walsh, leader of Redcar and Cleveland Borough Council, said: "All job losses in an area of high unemployment are regrettable but there is a ray of hope for the future of this factory because it is not actually closing and there is room for expansion.

"Hopefully these jobs can be renewed once the economic climate becomes brighter.

"Our council is dedicated to working with the Government and One NorthEast to create jobs in East Cleveland. Now we have to redouble our efforts."

Consultations began with trade union representatives and the individuals affected on Monday.

Rod Tompsett, chief executive of Rainbow Corporatewear, the company's parent group, said: "We very much regret having to reduce employment. We believe, however, that the changes will result in a strengthening of the company's performance so that it is able, once again, to plan for further improvements in our service levels to existing customers and also for growth. This will also allow us to improve the prospects for the majority of our employees and other stakeholders. We look forward to being able to increase employment, once again, as the company moves forward."

The jobs cut is a blow to a series of regeneration measures in the town and at the troubled industrial estate.