Hundreds of employees of United States Steel Corp at its Michigan plant are about to become jobless in the coming weeks, as the company decides to stop production citing falling sales and demand.
United States Steel's earnings could have provided some badly-needed reprieve for the struggling company. Unfortunately, that did not materialize.
Around 200 personnel at the Great Lakes facility in Michigan will be terminated in a span of six months, the Pittsburgh-headquartered firm disclosed in a Worker Adjustment and Retraining Notification (WARN) on August 5.
A United Steelworkers Union (USU) official said the job cuts will also affect the company's Gary Works facility in Indiana, but a U.S. Steel representative disclosed the company currently does not see any staff level changes at the said location.
According to Mark Tade, U.S. Steel's Employee Relations Director for the Ecorse operations, more layoffs are likely to happen on September 30 this year and "may continue periodically thereafter based on market conditions."
Based on a report by The Detroit News on Friday, U.S. Steel is planning to also stop operations at its blast furnaces in Ecorse, Michigan. The company has already terminated 50 workers, while fewer than 200 more could be given the pink slip by end of September.
A U.S. Steel official pointed out extreme "market conditions" that caused the layoffs. Just recently, US President Donald Trump and his cabinet imposed a 25 percent tax on steel exported by foreign nations.
The massive retrenchment puts into perspective claims Trump has made regarding the revival of the American steel business. Trump claimed that his 25 percent taxes on foreign goods has actually turned a "dead" business into a "thriving" market.
The company had to let go, though temporarily, 27 part-time positions and another 19 full-time and 2 part-time staff on Aug. 14, based on a notice dated Aug. 1. Meanwhile, prices of hot-rolled steel coil fell almost nearly 38 percent from their 2018 highs. The American steelmaker's share price has fallen 74 percent since March, 2018, when Trump announced that he will crack down on foreign imports.
The State of Indiana and the City of Gary have offered the company a $48 million tax holiday program to help it roll out $751 million in upgrading Gary Works, its biggest steel facility in North America. The state's tax credits and employee training subsidies were connected to an agreement that U.S. Steel will keep at least 3,890 workers at the said facility.
