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Corus to cut nearly 2000 British jobs

Corus to cut nearly 2000 British jobs
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First Published: Fri, Jun 26 2009. 10 28 AM IST
London: Europe’s second largest steelmaker Corus said on Thursday it was planning to cut a further 1,922 jobs in Britain’s industrial heartlands, alongside axing another 123 staff in the Netherlands.
Of the jobs to be cut in Britain, some 800 will go from Corus’s engineering steel sites in the northern English towns of Rotherham and Stocksbridge, while in the Netherlands, the jobs will go from the Corus Tubes division.
Office workers will not escape the cull, with some 500 white-collar jobs under threat in Scunthorpe.
Unemployment in Britain is already running at its highest rate in more than a decade, with 7.2% of people out of work.
Michael Leahy, general secretary of the community trade union, described the plans, which come after the Anglo-Dutch steelmaker axed 2,500 jobs at the start of the year, as “devastating”.
“This brings the Corus job cuts for the year to around 4,500 and that’s without the threat to thousands of workers on Teesside,” Leahy said in a statement, referring to the group’s search for a buyer for a majority stake in the plant.
Corus, part of India’s Tata Steel, said the additional job cuts, equivalent to 2.5% of its global workforce of 82,700, were necessary to cope with the decline in steel demand, and that while it hoped to implement voluntary cuts, it could not rule out compulsory redundancies.
“Any recovery in Europe appears to be some time off, so it is vital that we take this proportionate and responsible action now,” Corus said.
Global steel production has fallen over the last year as demand in key sectors such as construction and automotive shrunk, forcing steelmakers such as ArcelorMittal to cut back on production.
Peter Hogg, commercial director for Corus’ engineering division, said the group’s order book had fallen by three quarters and the group had to alter its cost structure accordingly.
“What’s clear to us now is that the economic downturn is going to last much longer and is going to be be much deeper than we’d ever anticipated,” Hogg said.
Governemnt action
Unite, the UK’s largest trade union, called on the government to support British manufacturing.
“Unless there is action from the government to support British manufacturing we will continue to see skilled jobs wither on the vine,” John Rowse, Unite’s national officer said in a statement.
Opposition work and pensions secretary Theresa May also called on the labour government to get credit flowing through the system and described the cuts as “grim news”.
A spokesman for British prime minister Gordon Brown said the government had written to Corus offering up to £5 million of training support to help secure jobs at Corus sites.
“Clearly this is very disappointing news for those affected and we do understand the difficulties that the company is facing as a result of the severe downturn in demand for steel around the world,” the spokesman said.
Separately, Tata Steel reported a 60% drop in net profit for the year.
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First Published: Fri, Jun 26 2009. 10 28 AM IST
More Topics: Tata steel | Corus | Steel | Job cuts | Peter Hogg |