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04. April 2016

UK Steel: Facts About Crisis-Hit Industr

UK Steel: Facts About Crisis-Hit Industr


What does the future hold for an industry that has been in sharp decline for over 40 years - as Tata plans to exit UK steel?

The UK steel industry employs around 25,000 people but is facing an increasingly uncertain future as Tata Steel looks at selling its businesses in Britain – casting doubt over the future of 15,000 workers.

Where are the Tata sites?

The Indian-owned firm's Port Talbot plant in south Wales directly employs 4,000. A similar number work in Scunthorpe. Other sites are at Rotherham in South Yorkshire, Llanwern and Trostre in south Wales, Shotton in north Wales and Corby in Northamptonshire.

Elsewhere the firm operates at Redcar and Hartlepool on Teesside, Newport in south Wales, and Walsall and Wednesbury in the West Midlands.

What does the future hold?

Tata is looking at offloading all or part of the loss-making UK business.

It has already agreed to sell plants in Dalzell and Clydebridge in Scotland employing 270 workers to industrial group Liberty House, in a deal brokered by the Scottish government.

Meanwhile, investor Greybull Capital is in talks over a rescue deal for Tata's Scunthorpe site but workers face a one-year pay cut to secure the future of the plant.

What if the business is not sold?

Options could include the Government taking a stake until a buyer can be found.

Without either of these the future looks bleak. Tata's UK steel business is losing £1m a day as the sector buckles under pressure from cheap Chinese imports and high energy costs.

What about the wider UK steel industry?

It has been in sharp decline for more than 40 years.

According to the Office for National Statistics, the industry employed 323,000 workers in 1971 and the number had halved to 167,000 by 1981. The numbers have collapsed still further since then.

Output totalled £2.2bn in 2014 though this was just 0.1% of the UK total. There were more than 500 businesses in the industry.

The Prime Minister maintains that the sector is "vital". Industry body UK Steel points to the well-paid and highly-skilled jobs it sustains and its key role in aerospace, defence and construction.

More than 5,000 jobs have gone in the last few months – including some at Tata and others due to the mothballing of Thai-owned SSI’s plant in Redcar, and another company, Caparo Industries, going into administration threatening jobs at a number of UK locations.

Other major steel players in the UK include Spain's Celsa, employing 500 staff and hundreds more sub-contractors in south Wales and Finland's Outokumpu which employs 600 people in Sheffield.

Another firm, Sheffield Forgemasters – employing 700 people – said earlier this year that it was consulting on up to 100 redundancies.

But the business, which is a critical supplier to the Trident nuclear submarine programme, has been backed by a £30m support packagefrom BAE Systems, Babcock International and Rolls-Royce, brokered by the Ministry of Defence.

Source: news.sky.com

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