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Working Lunch Tuesday, 29 April, 2003, 13:35 GMT 14:35 UK
The lingering death of the UK's steel industry

The latest job cuts announced by Corus are another sign of the lingering death that seems destined to be the fate of the UK's steel industry.

More than 1,100 workers are to lose their jobs, 800 at Stocksbridge in South Yorkshire, others at Tipton in the West MIdlands and Llanwern in south Wales.

And that's not all. The future of the Corus factory at Redcar on Teesside, with 2,900 workers, is threatened if it can't sell its products on the international market.

It doesn't seem that long ago that I stood outside the massive Redcar plant, reporting on plans to reduce the workforce by 6,000.

But that's been the story with steel in recent years.

A slow demise

It's suffered from overcapacity in the UK, a strong pound and fierce overseas competition.

In 1951 the steel industry employed 450,000 people

In 1951, the industry employed 450,000 people. Today that's down to about 21,000. But those figures tell only half the story.

Fifty years ago, the UK produced 16m tonnes of steel - 35 tonnes for each workers.

Today productivity has shot up - each employee now produces 623 tonnes.

For all its problems, steel has worked hard to stay competitive - the UK is still the world's fourth largest exporter.

But it's Corus - formed in 1999 when British Steel merged with the Dutch firm Hoogovens - which has overseen the latest decline.

Shareholders have seen the value of the company plummet. In the past year alone, the share price has gone from 90p to less than 20p. A severe blow if you were depending on the shares to provide a tidy pension like ex-worker Brian Cummings.

"I bought some shares in Corus for retirement - they're worth hardly anything today."

Meanwhile, executives' pay has risen, increasing anger among shareholders, workers and unions.


Earlier this month, employees staged a "red card" protest at plants around the country, calling for the resignation of chairman Sir Brian Moffat.

He now plans to retire in June, but this latest bombshell ensures he'll go out with a bang. Ironically, the announcement was made on the day shareholders gathered at the company's AGM to berate the board over its management of the company.

While it's hard to say how long the UK will continue to have a viable steel industry, the full impact of Corus's decline can be seen in towns like Ebbw Vale.

The industry has a future but it might not be British' Professor Faribrother says
According to local professor Peter Fairbrother globalisation and the government are to blame. The government for the lack of support given to former nationalised industries when it embraced its neo-liberal ideals and globalisation which is creating uncertainty in the industry.

End of an era

One Friday in July last year, the remaining 500 workers gathered to see the last coil of the line, ending more than two centuries of iron and steelmaking.

The huge plant was the biggest casualty of the cuts announced in 2001. Set in a valley on the edge of town, it now stands eerily quiet. Parts are being demolished, but it will be a long task.

There are plans to build housing, a college and a hospital on the site, but how many jobs will be created is anyone's guess.

Some steelworkers transferred to other Corus plants, but the rest faced the prospect of living in an area with twice the national unemployment rate and the lowest earnings in the country.

In the town centre, shops are boarded up and in the housing estates that cling to the valley, homes have been abandoned, locked up with steel shutters.

What is needed according to Professor Fairbrother is some long term integrated planning for the community, not short term measures.
"I lost a good job and a living when the plant closed" says Ron an ex-steelworker

"Many ex-steelworkers have had the blow of redundancy cushioned by pay-offs and pension money, but once that runs out, the effect will be massive." Professor Fairbrother, University of Cardiff.

Young people

Young people who would once have found employment in the steelworks complain that there are no jobs to be had locally. Many of them are forced to move away to find work.

The older generation fear that the town is dying on its feet.

"It's the young people I feel sorry for. We've had our day, but there's nothing here for young people, they need a chance." Bill Pritchard a former steelworker.

Damian Kettle, a young dad with 2 children starts a new job next week. But it's in London, so he'll have to travel there and back every day.

Even the local rugby team are called the Steelmen - how long before the origins of that nickname are lost in time?

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29 Apr 03 | Business

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