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100 Sheffield Steel Jobs Under Threat

Wednesday, January 20, 2016
Government Must Act To Save UK Steel Industry As Further 100 Jobs Are Under Threat In Sheffield

The lack of action from the EU Commission to stop dumping of Chinese steel is intolerable says GMB.

GMB, the union for steel workers, commented on the announcement that Sheffield Forgemasters is to begin consultations on 100 job losses. See notes to editors for copy of the story on Press Association dated 20th January.

Steve Morris, GMB Regional Organizer, said “GMB is incensed that the lack of action by the Governments and the lack of a coherent policy for manufacturing is once again costing jobs in South Yorkshire.

The Government have been asleep on the job allowing our steel industry to be disadvantaged in comparison to producers across Europe whilst actively encouraging China to dump its subsidised steel in the UK. The lack of action from the EU Commission to stop dumping of Chinese steel is intolerable.

The long term future demand for steel in the UK is healthy and will be even more so if the proposed Northern Powerhouse intra-structure improvements ever get off the ground.

However if we don't protect steel jobs now that demand will be satisfied by imports while highly skilled steel workers either receive benefits or carry out lower paid lower skilled jobs.

When the banks were in trouble the Government came to their rescue.  They shouldn't just sit on their hands when it comes to manufacturing jobs.”

End

Contact: Steve Morris 0114 2768017 or 07958 156843 or Dave Hulse 07971 266157 or Michael Blench 07870 176 748 Kathleen Walker Shaw in Brussels 07841 181549 or Jim Moohan, GMB Scotland on 07885 868405 or Shaune Clarkson, GMB Scunthorpe 07738 767561 or Jeff Beck in Wales on 07980 753 112 or Russell Farrington in West Midlands 07957 266519 or GMB press office 07921 289880 or 07974 251 823.

Notes to editors

Copy of story on Press Association- dated 20th Jan

Crisis-hit steel industry dealt fresh blow with news of more job losses

By Alan Jones, Press Association Industrial Correspondent

The crisis-hit steel industry has been dealt a fresh blow with news of more job losses.

Sheffield Forgemasters started consultations on 100 redundancies, just days after Tata cut 1,050 jobs mainly at Port Talbot in south Wales.

The company said reduced activity in the traditional oil and gas sector, the slowing down of growth in the global economy and an international collapse in steel prices had adversely affected its results for 2014.

The Sheffield company said caution expressed in its 2013 financial results had proved well founded, as it experienced a tougher global business environment.

Forgemasters also cited acute pricing pressures from international competitors combined with high UK energy costs as key factors.

A statement said: "The company's need to restructure the business means consultation on up to 100 redundancies across all its divisions has begun, with the emphasis on creating a more streamlined operation, better able to operate in the tough economic environment."

The announcement was made as it published accounts for the 18 months to December 2014, which showed a loss for the first time since a management buyout in 2005 - £9.4 million.

Sheffield Forgemasters chairman Tony Pedder said: "The storm clouds which seem to gather periodically over the steel and steel-related sectors are once again evident. A confluence of factors has made trading conditions for our sector particularly challenging for several months and this has led to difficult decisions for us.

"Of particular concern has been reduced activity in the traditional oil and gas sector, with oil prices down to a level that is deferring much potential new investment.

"This combined with a slowing of global economic growth has led to a scarcity of orders for our engineering products and an international collapse in steel prices, affecting our ingot and bar sales.

"For the first time, we have traded at a loss despite the best efforts of all in the company.

"In this situation, the company must continue to look to all sources of support. We have been working with our major customers, suppliers and in particular, our secured lender, with whom we have concluded an extension to our financing facility. This will provide adequate funding for the business through to end March 2017."

Roy Rickhuss, Community's general secretary said: "Every sector of the UK steel industry is caught up in the current crisis. We keep saying that delays in implementation of support and a lack of swift and decisive action by Government only puts more steel jobs at risk. Today's announcement by Sheffield Forgemasters just increases the number of steelworkers and their families worried about their futures.

"We will be meeting with the company in the coming days to examine and test their proposals, mitigate the impact on jobs and ensure a sustainable future for the business.

"The spectre of the UK's cosy relationship with China hangs over the entire steel industry. The Prime Minister needs to stand up to China and stand up for our steel industry. When the UK steel industry is cut out of procurement deals such as at Hinkley Point, or sees its Government cheerleading for China's market economy status then it's no wonder the industry is in crisis. We need to see evidence that Government is committed to the long-term future of UK steel making and that needs a lot more short-term action."

Harish Patel, Unite's national officer said: "World class companies like Sheffield Forgemasters need urgent support and a level playing field with their international competitors if they are to survive.

"It wasn't that long ago that Government ministers pulled the plug on a loan that would have allowed Sheffield Forgemasters to invest in new equipment making it more productive.

"The Government now needs to right that wrong by guaranteeing that British companies such as Sheffield Forgemasters are never again excluded from tendering for British infrastructure projects.

"If it's made for Britain then it should be built using British steel. Firms such as Forgemasters should be looking forward to helping build the new gas and nuclear power plants which are in the pipeline, not left fighting for their survival on an uneven playing field."

Shadow business secretary Angela Eagle said: "These latest job losses will be devastating news for the workers affected especially given the uncertainty that they've endured as the plant restructures to secure its near-term future. There is also a loss to the wider economy due the high-quality and specialist nature of the steel produced at the plant which is of strategic importance to our national security.

"The Government must take faster and more decisive action to assist, especially on relief for business rates and high energy costs."

Meanwhile, French energy giant EDF, which is building a new nuclear power station at Hinkley in Somerset, said the UK does not currently have the capability or capacity of producing the very largest forgings required by the power station, so these will have to be sourced from outside the UK.

There will be opportunity for suppliers, including those in the UK, to compete in the supply of forged components for the turbine generators and in other items such as pumps, motors, valves and the like.

Construction at Hinkley Point C will provide 25,000 jobs in the UK, 1,000 apprenticeships, and more than 60% of the project's construction value is expected to come from British companies.

"Hinkley Point C is a big opportunity for UK steel, as well as for UK construction and manufacturing more widely," said EDF.

A Government spokesman said: "It has been a challenging time for the steel industry facing tough global economic conditions. We will work with local partners to help anyone made redundant find new jobs as quickly as possible.

"We understand that Sheffield Forgemasters is taking this step to restructure the business to secure its long-term future and welcome the news that its lending facility has been extended.

"The Government has taken clear action to help the steel industry, through cutting energy costs, taking action on imports, Government procurement and EU emissions regulations, meeting key steel industry asks."

 

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