Oil price plunge means layoffs for US steel workers
United States Steel Corp said it would temporarily idle its pipe manufacturing plant in Lorain, Ohio and lay off 614 workers, largely due to weak demand from the oil industry. A number of North American oil and gas companies have cut capital spending plans following a sharp fall in oil prices.
Workers get ready to pull a piece of forged steel to be used in a heavy load helicopter out of a giant press at SifCo Industries in Cleveland, Ohio. US Steel Corp. is laying off 614 Ohio workers due in large part to plummeting oil prices, the company said Wednesday, Jan. 7, 2015.
Amy Sancetta/AP/File
United States Steel Corp said it would temporarily idle its pipe manufacturing plant in Lorain, Ohio and lay off 614 workers, largely due to weak demand from the oil industry.
The company sent a layoff notice to workers on Monday, citing weak market conditions. (http://bit.ly/1BE4HAs)
U.S. Steel's shares were down nearly 2 percent at $24.88 in early afternoon trading on Tuesday.
"The company has suddenly lost a great deal of business because of the recent downturn in the oil industry," the notice reads. "What appeared just a few short weeks ago as being a productive year, [with new hires in December and extra turns going on], has most abruptly turned sour."
"The International in conjunction with the leadership team of the Local have begun formulating plans to minimize the impact this may have on the membership," it continued. "We have been allotted 60 days in order to protect the rights of the membership, unlike in the past when layoffs occurred immediately."
A number of North American oil and gas companies have cut capital spending plans following a sharp fall in oil prices, which have more than halved since mid-2014.
Canada's Crescent Point Energy Corp, for example, said on Tuesday it would cut its spending by about 28 percent in 2015.
Oil service companies Schlumberger Ltd and Civeo Corp have also laid off workers as oil and gas producers cut costs.
The layoffs at U.S. Steel will begin on March 8, a spokeswoman said. The Wall Street Journal reported the impending layoffs earlier on Tuesday. (http://on.wsj.com/14i2EHH) (Reporting by Abinaya Vijayaraghavan in Bengaluru; Additional reporting by Ankit Ajmera in Bengaluru; Editing by Ted Kerr)