Rise of short-time working: Stuck in a very deep hole... and desperate for help to dig them out

The bright yellow machines come as a surprise in the Staffordshire countryside. Drive past a field full of sheep and there they are in their hundreds, mechanical arms aloft in salute to the "world headquarters" of JCB, which looks more like a military installation than a place for making diggers. Nothing was being made there at all on Friday, though. The factory was closed, so Gordon Richardson stayed at home instead and varnished a door.

"All the wives have given their men lists of things to do since the hours disappeared," said the 51-year-old works convener, finishing the job in his kitchen and smiling despite the desperate circumstances that forced him into DIY on a work day. JCB shuts down every Friday now as it struggles to survive the recession – and the company is leading the call for the Government to subsidise wages, as it considers a three-day week.

"My men voted to reduce hours in order to save jobs," said Mr Richardson, a member of the GMB union. The vote to cut out Fridays was taken in October and it worked: 300 people kept their places on the production line. But it was not enough. The economy worsened and 1,000 more jobs were lost, as customers found it hard to get the credit needed to buy machines. Earlier this month another 684 redundancies were announced – although the company insists some of those could still be prevented if Gordon Brown helps pay the wages.

"We would rather go to a shorter week than lay people off," Matthew Taylor, the chief executive of JCB, said on Friday. "I have been saying that to ministers, to the CBI and to anyone who will listen."

As he spoke, the HQ near the village of Rocester stood silent. So did eight other plants within a 15-mile radius. JCB is the biggest employer in the area, providing 4,500 jobs before the cuts. The company has landscaped the front of its headquarters into a lake, where children feed ducks and swans. It plans to build an academy for local teenagers. But production is down 75 per cent on last year, and more savings may have to be made.

Mr Taylor wants the Government to copy Germany, where, if there is only enough work for three days, the state – temporarily – helps out with the salary costs for the remaining days. "Our people there earn 75 or 80 per cent of what they were earning before, but they are still in a job and still getting pension and healthcare benefits," he said. "You've got to believe that's better than putting them on the dole." If such a scheme were to come in here before 12 April, when the consultation period for the latest redundancies ends, "we would want to see how many of those people we are having to lose we could bring back straight away".

Mr Richardson would welcome it. "There's nothing for the men to go to," he said. "This area has seen the iron, steel and coal industries all go down, and now this. It's ripping the heart out of the community." He is a father of three whose wife works as a hairdresser. "Hairdressers, building societies and charity shops, that's all the town is now. And those are going too."

Uttoxeter, a market town of about 12,000 people, became quite smart in the good times – but lately the signs have gone back up in the Market Place: "For Sale", "To Let" and "Closing Down". "Look at this," said Alice Clark, in from a nearby village, pointing at an antique shop that had shut. "It won't be the last."

Ironically, perhaps, it was a local man who had been made redundant who started JCB, and whose initials the company bears. Joseph Cyril Bamford started making agricultural trailers in a tiny shed in 1945 after being let go from the family firm. But Little Joe proved brilliant at engineering and marketing: inventing a hydraulic system and sending his diggers "dancing" through Las Vegas to boost sales. JCB now has factories in the US, South America, India and China, employing 3,000 people overseas. It is still a family business, chaired by Joe's eldest son, Sir Anthony, who is also an organic gardener.

The digger is celebrated in one of the most idiosyncratic theme parks in the world: Diggerland, replicated in Devon, Durham, Kent and Yorkshire. JCB even appears in the dictionary, defined as a mechanical excavator with a shovel at the front and a digging arm at the back. JCBs buried the stranded whale earlier this month, and it was a JCB that an estranged husband used to dump 20 tons of rubble on top of his wife's car.

The company's mission statement insists, piously: "It's not about machines. It's about people." That may be supported by donations of equipment to help survivors of earthquakes and the tsunami, but must be harder to accept if you've just been handed your P45. "The people we are having to lay off are good, skilled workers," Mr Taylor said. "They are the ones who made JCB into a great company." In Christmas 2007, Sir Anthony celebrated a record-breaking year with a £1,000 bonus for every worker. But "when the economy took a violent turn for the worse" customers found they could not start building projects – or buy equipment – because they could not get bank loans.

GMB members voted by 70 per cent to 30 in October to accept a reduction from 39 hours to 34. "I was proud of my men for voting that way," Mr Richardson said. In the good times some had been working 60 or more. "We were the best-paid men around here, because we had so much overtime."

As convener, he has had to help make decisions about his fellow workers. "There have been tears. I have seen friends go through it." Relationships have been strained. "I might be able to save a man's job in the discussions first time around, even the second, but not the third. Then he thinks I'm a twat. Fair enough, I suppose."

A strike wouldn't work, he said, because withdrawal of labour would be welcomed as a way of saving money. "They say to me, 'If you're going to go on strike, can you make it at least eight weeks?'" JCB recently closed its factories for a week so that 2,000 surviving staff could be trained. Those let go have retrained. "One lad wanted to be a canoe instructor. A couple of others have gone for their HGV licence."

Just how deeply JCB is woven into the community was shown by a letter in the local paper from Jennie Allen of Meir, a 23-year-old mother of two children. Writing to say she could not sell her home and was struggling to pay for it, she asked a question Gordon Richardson and Matthew Taylor would dearly love to put to the Prime Minister. "We can't rent anywhere as my partner has been made redundant from JCB. I might be made redundant from JCB too, when I return from maternity leave. Please can someone just help us out?"

March of the three-day week

LDV (Dec 2007) Hundreds of workers at Birmingham van-maker learn of new three-day week.

Lawson and Heaton (Apr 2008) 350 put on three-day week after closure of company's Birmingham section.

Komatsu (Jun 2008) Engineering giant goes to a three-day week.

Bentley Motors (Sept 2008) Workers at luxury car firm's Crewe plant put on a three-day week.

Ford (Oct 2008) More than 1,000 workers on a four-day week at the Transit plant in Southampton.

Nissan (Oct 2008) Sunderland car-maker goes on three-day week.

Kenneth MacKenzie Ltd (Oct 2008) Workers on Stornoway told they will be working from Mon to Wed.

Leoni Temco (Nov 2008) Staff at the Gloucestershire wiremakers vote for a three-day week after nearby Lydney Building Concepts goes to two days.

HJ Berry (Nov 2008) Workers at Lancashire chair-maker back plans for a three-day week.

Hawick Knitwear (Dec 2008) 200 workers agree to three-day week.

FT (Dec 2008) Staff offered three-day week to avoid cuts.

Arntz Belting (Jan 2009) Londonderry fan belt firm moves to a three-day week.

Holden Aluminium Technologies (Jan 2009) Hereford firm cuts week to three days.

TRW Automotive (Jan 2009) More than 100 in Pontypool on a three-day week.