Fifty-one jobs are set to go at a shirt-manufacturing company in Donegal, it was confirmed yesterday.

Competition from lower-cost economies in eastern Europe and the loss of a major customer in the aftermath of the September 11th attack on the World Trade Centre in New York were cited as the main reasons why Clubman Omega has been forced to reduce its workforce.

The firm, which specialises in shirts at the top end of the market, intends closing its Carndonagh factory on November 30th with the loss of 19 jobs. This unit was opened only three years ago at a time when the company was expanding.

A further 32 jobs will be lost at the company's main plant in Buncrana. Managing director, Mr Sean Tighe, said that the decision had been taken with "deep regret" but he added that there was no alternative.

"The problem really goes back to September 11th and in the aftermath we lost a major customer who took 35 per cent of our business," he explained.

He added: "We have come under enormous cost and price pressures from our UK customers and we have now been forced to outsource much of our contract and private label business to Lithuania."

However, he remained upbeat about the long-term future for the remaining workforce of 74 in Buncrana.

"There is good demand for our brands and further opportunities will continue to present themselves, particularly in the specialist end of the market," he said. The firm supplies exclusive shirts to a number of high-profile stores including Saks on New York's Fifth Avenue.

Reacting to the news, the Tánaiste and Minister for Enterprise, Trade and Employment, Ms Harney, said that the resources of FÁS and other State agencies will be available to assist those being made redundant in their search for alternative employment.

This brings the number of job losses in the troubled textile sector in Donegal to more than 70 this week. On Wednesday, NC Shirt Manufacturing Limited in Newtowncunningham announced it was closing with the loss of 20 jobs.

Meanwhile, it has been announced that 84 start-up companies backed by Enterprise Ireland have created 3,600 jobs in the past three years. The businesses have generated sales of €250 million and exports worth €93 million.

The success of these start-ups demonstrates that small indigenous firms play an important role in the economy, said Ms Harney.

Many of these companies began as university start-ups, highlighting the emerging role of the third-level sector in fostering innovation, said the Tánaiste.

She added: "Their contribution to innovation development improves the business climate and influences the conditions in which growth is achieved."