The British coal industry is a mere shadow of its former self, when it was the largest employer in the country, as BBC Business correspondent Nik Wood reports.

When the closure of Ellington colliery, the last pit in the northeast of England, was announced in November, it made what was once unthinkable seem almost inevitable.

An offer to take over the pit is being considered, but unless that develops, the 400 miners face joining a growing army of men shrugged off by this constantly contracting industry.

Yet for much of the century, coal was king, fuelling manufacturing and providing heat for homes. It was hard but honourable work, employing a million men, and miners were a powerful force. It was a protest over working hours and pay in the mining industry that led to the 1926 General Strike.

"The coal industry effectively built the country and was easily the most significant coal industry in the world," says David Price, editor of Coal UK. "At one time, in about 1913, the industry was exporting as much as the whole world exports today."

Nationalisation

When the Labour government nationalised the industry in 1947, it still employed 750,000 people.

But the discovery of North Sea gas and increased imports saw consumption of domestic coal start to fall. Pits closed down at an alarming rate, leading the miners to a series of strikes. It culminated in the year-long dispute which finally ended in 1985.

The strike was overtly political, with Margaret Thatcher's Conservative government determined not to give in. The action left bitter divisions within communities, even within families.

Some observers argue that the strike effectively signalled the end of mining as it had existed for so long.

Pit closures

For others, the final blow came when the Conservatives shut 30 pits in 1992. Trade Secretary Michael Heseltine called it the hardest decision he had ever had to make.

Even though he bowed to pressure to reprieve some pits, more than 30,000 miners faced unemployment. Even the promise of £1bn in aid could not help stem the fear that communities reliant on mining would be devastated.

What remained of the industry was privatised shortly afterwards, with Richard Budge's RJB Mining paying £800m to take over most of the pits.

However, the so-called dash for gas - relying on gas-fired power stations rather than those using coal - has reduced demand further.

Still angry

The mining industry feels aggrieved that the present Labour government, which fought against such power stations while in opposition, now endorses them.

Meanwhile, the markets for domestic coal are increasingly looking to cheaper imports from countries with a subsidised mining industry.

Of all the traditional heavy industries of the past century, it is mining which has probably suffered most. It now employs just a tiny fraction of the huge numbers who toiled underground to fuel the country.

Vastly increased productivity has been to little avail.

RJB has fought to keep the industry alive, but like any commercial concern, has had to deal with the realities of modern competitive markets.

Its share price, once over 600p, has recently been as low as 33p.

Pit communities suffer

But perhaps the greatest tragedy of the decline of British mining has been the effect on the communities of Wales, Scotland and northern England.

Whole families worked together down the pit; now they are often scattered nationwide in the search for employment.

Those still working in the industry believe strongly that there is a future for coal.

David Price agrees, but thinks wider economic patterns are now dictating its destiny.

"There is space for coal to survive - the UK industry is still the most efficient in Europe," he says.

"Where we have a problem at the moment is that imported coal is much cheaper, a temporary phenomenon which will disappear as overseas coal prices rise in the next couple of years. But at the moment, UK coal just can't compete."