The British Government has come under renewed pressure to take action to support the steel industry after Tata Steel announced yet another round of job cuts.
Tata Steel is expected to cut around 1,000 jobs at its steel plants which include plants at Port Talbot and Llanwern in South Wales. This latest round of layoffs from Tata Steel follows a series of job cuts the company has had to undertake in its UK operations, amounting to a total of more than 3,000 employees being downsized in the last six months. Job cuts by other companies include 1,700 jobs lost by the closure of the SSI plant at Redcar on Teesside.
Most of these job losses have occurred in towns that depend heavily on jobs in steel plants, causing these job cuts to have a much wider impact on the local community and business.
The UK steel industry has been in a severe crisis for some time now. Industry experts have highlighted a number of factors for the crisis such as falling prices, the strength of the pound against the euro, high energy costs and alleged dumping of cheap steel by China. Tata has said that steel plate imports into Europe have doubled in the past two years and imports from China have quadrupled.
When Tata Steel confirmed yet another round of job cuts, the company stated that it was a result of falling global steel prices and cheap imports flooding the market. Karl Koehler, chief executive of Tata Steel’s European business said that the European Commission must improve its response to “unfairly traded imports.” He has demanded lowering of business rates and supporting energy efficiency and anti-dumping cases so that UK companies can compete fairly.
Steel union leaders have also asked for the British government to step up support to the industry. In a statement, Roy Rickhuss, general secretary of Community, a UK trade union said,
Today’s announcement is no reflection of the skills and commitment of the Tata Steel workforce, which has been breaking production records over the past year. Even now, promised compensation for energy intensive industries is yet to be received. The dumping of cheap Chinese steel is one of the biggest causes of this crisis, yet the UK government remains a cheerleader for China.
Harish Patel of Unite union echoed the opinion saying that the “knock-on effects” of these job losses will impact the entire supply chain and the wider manufacturing community in the UK and affect George Osborne’s proposed plan to rebalance the economy. He has warned that unless UK takes swift action, “a strategically important part of the UK economy” faces a “wipe-out”.
