March 03, 2009
BY NAOMI POWELL
Hamilton Spectator
U.S. Steel Canada is shutting down its Hamilton and Lake Erie operations, putting 1,500 employees out of work.
Operations will be halted over the next several weeks as Pittsburgh-based U.S. Steel consolidates production at its plants in Pittsburgh, Indiana and Alabama.
"The difficult decision to continue to temporarily consolidate our production, we believe, is a necessary response to current market conditions," U. S. Steel CEO John Surma said in a release.
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Union leaders at the former Stelco, who were notified of the plan at about 3 p.m., say they have not been told when the layoffs will take effect or when operations will resume.
"It's devastating for the community," said Bill Ferguson, leader of the United Steelworkers union at Lake Erie. "For the local people this will be quite a blow. This plant, Lake Erie, has never shut down in its history."
The steel industry has been hit by one of the worst downturns in demand in decades. With the global economy tanking, orders from key buyers in the construction and auto industries have flatlined.
Steelmakers around the world have been slashing production and laying off workers in response.
U.S. Steel Canada has already cut close to 700 of its 1,700 hourly workers in Hamilton, where it shut down its blast furnace in November.
The remaining operations at the plant, including its steel finishing lines and coke ovens, will now be closed as well, said Rolf Gerstenberger, president of the United Steelworkers union at the plant.
All operations at Lake Erie Works in Nanticoke, except for the coke ovens, will also close.
“This is awful for Hamilton and it shouldn’t be allowed,” Gerstenberger said. "Layoffs are not solutions. They only make things worse.”
Unions will soon be holding meetings to inform members of the details of the shutdown.
Hamilton Mayor Fred Eisenberger said he was called by a U.S. Steel Canada representative this afternoon to warn him about the impending announcement.
“I was stunned,” he said, noting he has family working at the company, a connection he suspects many Hamiltonians also have. “It’s hitting pretty close to home.”
Eisenberger said he’s urging the federal government to deal with its employment insurance issues quickly. He added that the temporary shutdown “screams out” for the need for immediate infrastructure spending to help the troubled economy.
“The good news is this is not a shutdown. This is an idling,” he said. “This is not the end of the steel industry in Hamilton.”
Pittsburgh-based U.S. Steel bought Stelco for $1.9 billion in 2007.
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