Tata Steel job cuts: Industry is ‘in crisis’

Tata Steel-business news-people re-el magazine

The Tata Steel plant in Scunthorpe, Lincolnshire

18 October 2015

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The steel industry is “in crisis” and needs “life-saving surgery”, the director of UK Steel has warned.

Gareth Stace has called on Business Secretary Sajid Javid to honour promises he has made to address some of the challenges facing the industry.

It comes as Tata Steel is expected to announce 1,200 job cuts at sites in Scunthorpe and Lanarkshire.

Mr Javid said “there is no straightforward solution to the complex global challenges” facing the industry.

‘Stem flow of blood’

The Tata Steel redundancies follow the closure of the blast furnace and coke ovens at SSI’s plant in Redcar, Teesside, where 2,200 jobs have been lost.

“Sajid Javid needs to deliver now, in days and weeks not months and years, on energy costs, business rates costs and fair trade,” said Mr Stace.

“What I would say is that we need to stem this flow of blood, not with sticking plasters but now with life-saving surgery. The steel industry really is now in crisis.”

Tata Steel is expected to significantly reduce the workforce at its Scunthorpe site, which employs 4,000 people and is one of the UK’s largest steel plants.

It may also cut jobs at Clydebridge, Cambuslang, and Dalzell, Motherwell.

Tata has not yet confirmed the job cuts but said it has been facing challenges in the UK, including a surge in steel imports and the strong pound.

A spokesman for Tata, which employs about 17,000 people in the UK, said on Friday: “We’ve made a number of structural changes to our UK business over the last months and years to make us more competitive.

“Like all companies we continue to review the performance of our business.”

‘Supporting workers’

Mr Javid said: “There is no straightforward solution to the complex global challenges facing the steel industry.

“The government is committed to working closely with industry on both short-term and long-term issues and to doing everything we can to support both industry and the workers.

“A strong economy underpins everything and we will continue to focus on securing the UK’s economic recovery across the UK.”

Unions have also called on ministers to take urgent action to save the industry, while CBI director-general John Cridland has urged the government to work with businesses on a long-term industrial strategy.

Mr Javid chaired a summit in Rotherham on Friday, involving unions, business leaders and ministers, that had been organised in light of the SSI closure.

SNP leader Nicola Sturgeon said her party “will leave no stone unturned in our efforts to find and secure a viable future for these plants and for our steel industry here in Scotland”.

She told her party conference in Aberdeen: “If our worst fears are realised next week, I can confirm that I will immediately establish a task force to work with the company, the trade unions and the relevant local authorities.”

Tags:business, business news  financial news, business finance, small business websites

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