With its immense workforce and large number of factories spread across its territory, it’s not entirely surprising that China managed to disrupt the steel market balance.
The Pennsylvania-based steel manufacturing corporation US Steel reached an agreement with its workers union, United Steel Workers, earlier this Saturday. Even if the agreement in question is only tentative at this point, covering a 3 year period, it will complete its installation after a couple of weeks.
The USW started to emphasize their move towards an agreement following the US Steel decision of laying off 2.000 workers from the steel mill in Granite City by the 27th of December. This decision was made because the steel mill in question is to remain idle for the following year, with no news regarding its eventual restart. This worker union represents over 18.000 steel workers under the US Steel Corp., which has around 24 local steel manufacturing factories across the local perimeter, as well as the various local unions formed by said workers.
The foundation of USW’s bargaining with US Steel was laid back in June 2015 when the steel manufacturing market as a whole started to show signs of an impending crisis. The signs were true, the crisis in question engulfing most of the steel working plants across the US. The negotiations towards a beneficial agreement continued even after the previous contract expired on the 1st of September.
The aforementioned crisis was created by various factors. Imports from Asian markets priced illegally low, with an added decrease in fuel prices that came in tow with a decline in oil and gas drilling, made the steel market become oversaturated. This increase in steel supply made prices go down across the globe, not only in the US, making steel companies put their factories on hold, as well as being forced to lay off countless steel working employees.
The US Steel opened the discussion with a rather dire proposal that consisted of high cuts made towards wages and benefits. This caused a major uproar from both the workers and the worker unions pertaining to this side of the industrial market. The major income cuts would have made tens of thousands of families unable to sustain their lives by cutting of hundreds of thousands of dollars from their normal wages.
This was deemed completely unethical by the USW, mainly due to the fact that US Steel effectively forced their employees to suffer as if they would have been the reason for this oversaturation. The global overcapacity is caused by unfair trade stemming from China, with the USW stating that their members should not be made into scapegoats for this current crisis.
Even if US Steel reached an agreement with its workers union, the specific details of this 3-year contract will not be officially released until said contract goes through a ratification vote. After the process is complete, there are high odds that workers fears will be somewhat put to rest. But due to the current crisis, steel workers should not expect a major improvement towards their benefits, income and job stability. As the crisis continues to exist, more and more workers face the threat of being laid off.
Image source:www.pixabay.com
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