So it begins - Recession fans economic nationalism in the UK

GRIMSBY, England, Feb 18 (Reuters) - At the Job Centre in Grimsby, a hard-knock town on Britain's east coast, security guards man the doors.

Inside the government-run office, dozens of men and women, many in their teens or early 20s, crowd the waiting area, hunched over computers scanning the job listings.

Outside, others gather to smoke, drawing hard on their cigarettes before coming in to search for the latest opportunities, then drawing even harder on their way out when they have discovered once again that there is nothing going.

All the while, security staff watch for trouble.

"There's always a few problems in here," says Danny Brewitt, a 19-year-old who has been looking for construction work for weeks without success, thwarted by an economy that has dragged Grimsby and the rest of the country deep into recession.

Asked to put his finger on why there seems to be so little work available, Brewitt does not hesitate in replying.

"It's the foreigners," he says. "The Poles and other immigrants who come here will work for less."

He is quick to explain that he has no problem with Polish people, or immigrants in general, it is just the fact they will accept the minimum wage (about $8 an hour) for most work, whereas skilled or semi-skilled British workers expect more.

"They're undercutting the market," says Brewitt frankly.

Whether or not that is true -- and there is plenty of evidence that hundreds of thousands of migrant workers from new European Union states who have come to Britain in the past four years have added much more to the economy than they have taken away -- it highlights a worrying aspect of the downturn in Britain: an accelerating drift towards economic nationalism.

"BRITISH JOBS FOR BRITISH WORKERS"

Since the global financial crisis began in late 2007, British Prime Minister Gordon Brown, a former finance minister with a long economic track record, has cast himself as the man to lead Britain -- and even the world -- in uncertain times.

In that role he has wasted no opportunity to urge other states not to resort to protectionism to defend their economies, and will host a meeting of the 20 largest economies in London in April when that message is likely to be strongly reiterated.

It is comments he made before the crisis began, after taking office in June 2007, that have undermined his anti-protectionist credo and given British workers, traditional supporters of Brown's Labour Party, a reason to feel aggrieved.

Speaking to Labour supporters in September 2007, Brown promised "British jobs for British workers", a pledge that even at the time made the jaws of some Labour faithful drop.

Now the phrase is a rallying cry for British workers, who have held a series of protests at power plants countrywide in recent weeks, demonstrating against the employment of foreign contractors to work on critical energy sites.

Some of the most drawn-out demonstrations have been at the Total-owned Lindsey oil refinery near Grimsby, where British workers have criticised the employment of imported Italian and Portuguese labourers on the construction of a new plant.

"We've fought tooth and nail to get a decent deal for ourselves and now others are being brought in to do the work," said Paul McDowall, a disgruntled British worker, earlier this month, calling on Brown to respect his British jobs pledge.

"It's got nothing to do with racism. You have to protect our workers and their rights, otherwise what are you going to do?"

Under EU and British law, companies such as Total have the right to bring in foreign contractors to work in Britain.

The free movement of labour is a central tenet of the 27-member union. Under the rules, more Britons are working abroad than citizens of other EU members working in Britain.

As the economic downturn deepens, with Britain's gross domestic product forecast to contract by as much as 2.8 percent this year and unemployment edging above 6 percent, Brown and other Labour leaders are aware it will be a struggle to placate British workers while avoiding protectionism.

POLITICAL FALLOUT

There are already signs of political fallout, with the demonstrations at the Lindsey refinery spreading to half a dozen other power stations and nuclear plants nationwide.

The far-right British National Party (BNP), which is opposed to EU membership and wants limits on immigration, has seen its popularity surge in the East Midlands and areas near Grimsby, according to the party's regional coordinator Geoff Dickens.

In a local council election in the town of Boston, the BNP won the seat, defeating Labour, Conservative and Liberal Democrat opponents.

"We're seeing a steady increase in support across the whole area and have been for about a year," said Dickens. "It's a region where there's a certain amount of discontent and where earnings have traditionally never been that high."

On its website, the BNP has a banner at the top reading: "British Jobs for British Workers. When we say it, we mean it!"

In Grimsby, a grey and weather-beaten town of about 90,000 people where the unemployment rate in some areas is 20 percent, the darkening outlook is steadily taking its toll.

Grimsby was once one of the largest fishing ports in Britain, with a vast fish-packing and frozen-food industry, but its docks are run down and fish merchants are moving out.

Kevin Stansfield is a second-generation fish merchant who has invested heavily to try to stay in business. His son has followed him into the game even though Stansfield advised him against it. There was no other work to pursue.

Asked what he believes to be the biggest problem for jobs and industry in Grimsby, he and a colleague are quick to reply.

"It's the foreign workers," they say, almost in unison. "They'll work for next to nothing and that undercuts the market. Local labour just can't compete."

By Luke Baker.

Sadly, this will become a global trend - KT