Editor’s note: This story has been updated to include comments provided by the United Steelworkers labor union.
U.S. Steel is idling its operations indefinitely at its plant in Granite City, Illinois, laying off 1,076 workers, according to a Worker Adjustment and Retraining Notification Act notice posted Tuesday on a state website.
The decision was based on U.S. Steel’s risk mitigation strategy, a spokesperson told Manufacturing Dive in an email. In September, the company temporarily idled its last blast furnace at the Granite City site to reduce fixed costs as a result of the then-ongoing United Auto Workers strike with the Big Three, U.S. Steel President and CEO David Burritt told analysts in an earnings call last month.
Automotive comprises approximately 30% of U.S. Steel’s flat-rolled segment, SVP and CFO Jessica Graziano told analysts last month.
“I say this was a difficult decision, and it truly was, but it was a necessary one,” Burritt said. “We acted to ensure that our melt capacity is in line with demand. We remain nimble, enabling us to maintain profitability as we manage through uncertain market conditions.”
As a result, 400 employees were laid off in September, the spokesperson said. The more than 1,000 job cuts referenced in Tuesday’s WARN notice include the 400 employees who were already laid off in September, the spokesperson said.
Many of the Granite City workers are United Steelworkers members and U.S. Steel said it has remained in communication with the union.
The United Steelworkers said in a press release Thursday morning it condemned the layoffs as well as U.S. Steel's production pauses during the UAW strike.
“The company’s clumsy attempt earlier this year to pit workers against each other by blaming changes at Granite City on the autoworkers’ strike further demonstrates its cynical and opportunistic view of American labor,” USW District 7 Director Mike Millsap said in a statement.
“As we look to the future of the U.S. steel industry,” Millsap added, “the USW intends to draw on every resource we have available to ensure our members – in Granite City and across the country – are treated with the dignity and respect they deserve.”
The Granite City site produces hot-rolled, cold-rolled and coated sheet steel products for the construction, container, piping and tubing industries in addition to automotive. Now that operations are idled indefinitely, the company will consolidate iron and steelmaking operations to its other U.S. facilities to meet customer demands, the spokesperson said.
“As we look through the quarter, we’re really going to focus on the order book, and ultimately make a decision on whether or not we see that order book activity reaccelerate and use that as the guide to decide on making the most efficient use of the footprint and then get to ultimately whether or not we decide to turn Granite City back on,” Graziano said in the earnings call.
The Illinois plant isn’t the only site to receive a layoff notice. The steelmaker has also issued WARN notices to 105 employees at its service center in Pittsburgh as part of U.S. Steel’s Best for All strategy to change its information technology operating model and restructure its IT function, a spokesperson said.
