CONCERNS are growing in Dundalk about the future of one of the town's largest employers Keytronic Europe.

With industry sources predicting that more than 300 jobs are to go at the plant, the Minister for Enterprise and Employment, Mr Bruton, is to travel to Dundalk tomorrow to meet local development agencies.

It is believed he may announce a new investment project for the town, likely to involve more than 200 new jobs.

Keytronic, a US-owned company, produces computer keyboards and employs around 400 people. Local sources believe the workforce could be cut to as low as 75 as the company shifts production to a location with lower labour costs.

IDA Ireland has confirmed that it has given £3.5 million pounds in grants to the company since it established in 1985. A statement from management on whether it would be relocating production out of Dundalk is expected on Friday. If it does, it is believed the Dundalk outlet may then be used as a distribution centre.

Louth Fianna Fail TDs Mr Dermot Ahern and Mr Seamus Kirk and Employment spokeswomen Ms Mary O'Rourke raised the matter during the adjournment debate in the Dail last night. Mr Ahern said the possible downgrading or closure of the plant would have a greater effect on Dundalk than that of Packard Electric on Tallaght.

Unemployment in Dundalk has increased by 10 per cent in the last year and he said job losses on the scale feared in Keytronic would have a devastating effect. The managing director of the company had informed him that intense discussions were taking place within the company and with relevant government agencies.