Fewer steelworkers hear back-to-work call as mills consolidate

In many ways, these are good times in Middletown. Christmas sales in this mid-sized southwestern Ohio city were up. Unemployment is down. And the city's largest employer - Armco., Inc., - is recovering from a devastating slump. On Dec. 11, it recalled the last 81 of its laid-off workers at its steel plant here.

But Bill Goodlett, an Armco pipe-machine operator for 31 years, isn't happy. ''They think more of a chunk of iron than they ever thought of an employee,'' he says.

He is one of 16 Armco workers in a construction piping department that was idled earlier this month. Instead of being laid off, the workers have been shifted to the labor pool, where pay varies with the temporary position assigned.

It's not so much the possible pay decrease that bothers Charlie Herald, a 37 -year Armco employee. It's retirement. He is entitled to $600-$650 each month in early-retirement benefits and possibly a $400 a month special pension if his department was shut down. Armco says the bonus doesn't apply since the plant is merely idled because of lack of orders. The union says the plant is shut down and has filed a grievance.

Like steel companies across the United States, Armco and its employees are finding the road to recovery has a lot of potholes this time around.

The United States Steel Corporation, which is the country's largest steel maker, announced Dec. 27 that it was closing all or parts of 30 steel plants, iron ore and coal mines, and other facilities, representing 16 percent of steelmaking capacity. The plans, which take effect next April, will eliminate 15 ,430 jobs. In the first nine months of this year, US Steel lost $497 million on its steel business.

A vigorous recovery in consumer goods has improved the outlook forsome steel plants, like the Middletown plant that makes steel for cars and appliances. Steel sheet shipments are up 20 percent for the first 10 months of this year, compared with 1982, according to the American Iron and Steel Institute.

But in the major portion of the industry - the capital goods sector that makes steel for everything from oil rigs to farm equipment - recovery is virtually nonexistent.

Domestic steel producers, such as US Steel, have countered by consolidating operations, closing down old and inefficient sections of plants while gearing up their more modern facilites. Within the next two years, Armco plans to close its four outdated open-hearth furnaces in Middletown and its outdated hot-strip mill in Ashland, Ky. The idea is that more steel will be made in Ashland's efficient blast and basic-oxygen furnaces but processed in Middletown's modern hot-strip mill.

''The industry will emerge smaller but stronger,'' says an industry source, and more efficient.

Unfortunately for Raymond Back, efficiency is a two-edged sword.

Mr. Back, a big bear of a man who heads the Armco workers union, is concerned that fewer workers will be needed to man more efficient mills.

Last May, Back's independent union followed the lead of the much larger United Steelworkers of America and accepted its first wage-and-benefit concessions. But USW President Lynn Williams last week warned that the union won't accept further concessions that are being asked of individual union locals.

Even in Middletown, which escaped the worst of the steel recession, Armco has lost its traditionally good relationship with steelworkers in recent years, Back says.

''Our relationship here is more of a bureaucracy,'' he says. ''I look at Armco as a huge conglomerate with people on Wall Street calling the shots with little or no feelings for the employees.

''I'd like to change the relationship between the plant manager and the working man . . . . You'd be surprised how much this would increase the productivity of this country.''

He sees the recent union concessions in several industries as the result of a careful strategy by industry and government to weaken labor unions. The first stroke was the air controllers strike in 1981, which the government declared illegal.

''Man, I don't see it,'' he says. ''In Poland, they made a national leader out of the man for doing something they have denied our people to do.''