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Northwest Indiana Steel Bends, Doesn't Break

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Northwest Indiana Steel Bends, Doesn't Break

Inside ArcelorMittal Plant in Burns Harbor, Indiana. (Photo provided by ArcelorMittal)

The downturn in the national economy is hitting the steel industry hard. It’s a change for the steel business, which has just gone through a hugely profitable few years, especially in Northwest Indiana. Indiana steelworkers are watching lay-offs by the hundreds in other areas of the country. And they’re beginning to hear whispers of the “L” word closer to home.

Last week was a good one for Jim Robinson. He directs the United Steelworkers of America union for Indiana and Illinois. The union won a court case last week on early voting in Indiana Then, steelworkers for ArcelorMittal, the world’s largest steel producer, approved a lucrative four-year labor contract.

Nine thousand of those workers are in Northwest Indiana. But that good week came in an otherwise not-so-great month for Robinson, who says things have turned sour for steel virtually overnight.

ROBINSON: This came on very quickly.

Robinson is referring to the hit steel is taking because of the slumping economy.

ROBINSON: The issue right now is not the steel industry, it’s the customers. Large part of the Northwest Indiana steel industry is supplying steel to the auto industry. As they reduce production, they obviously reduce buying steel and that’s causing a bad reduction in orders.

ambi from inside steel mill

It’s a new slump for steel, which for most of this decade has been thriving. Sure, there are now fewer companies than in steel’s heyday in the 1930s and 40s, but the companies that are around, like ArcelorMittal and U.S. Steel, are stronger, Robinson says.

They help to employ nearly 20,000 people in the region. Although Northwest Indiana has made significant steps to diversify its economy, steel is still its calling card.

So when talk of possible layoffs is heard people listen. ArcelorMittal just announced that it’s looking for up to 500 workers at its Porter County plant in Burns Harbor to take voluntary layoffs.

Most steelworkers don’t want to think that “voluntary” is a first step to wholescale layoffs but Northwest Indiana they know to be prepared.

Unlike in the 1960s and ‘70s when huge layoffs left many steelworkers with no place to turn to learn new skills, today there’s help.

JobLink in East Chicago, Indiana, is one place steelworkers can take classes to learn everything from cooking, to learning how to play an instrument, to computer programming.

It’s a service of United Steelworkers Local 1010 and it’s been around for nearly 20 years. Bill Needles instructs a computer certification class. When times are good for steel, class attendance hurts.

NEEDLES: We think that maybe with the change here and the slow down, we’ve already heard it from some students that they are going to be much more interested in continuing their educational pursuits.

Ron Kaszak is one of those pursuing an education in computer programming. With 30 years under his belt at ArcelorMittal, Kaszak isn’t too worried about losing his job, but wants something to fall back for future years.

KASZAK: It’s a hobby. It’s also where I’m headed. I work on machines for myself and with my friends and hopefully when I’m retired I can do something in this field.

U.S. Congressman Peter Visclosky of Northwest Indiana, says even if the economic downturn gets worse, steel likely will be okay.

VISCLOSKY: I do think it’s better positioned today than a decade ago to weather this economic storm. You clearly have a significant decline in demand but I do think we will be able to work through that.

Visclosky says the real threat to the market is foreign steel imports. John Packard agrees.

PACKARD: For most of this year, imports were not a significant factor in this market place. But over the last few months, that’s started to change.

Packard publishes the Steel Market Update newsletter and Web Site near Atlanta. A weak overseas market could have companies from Europe, Asia and South America dumping cheaper steel here.

PACKARD: Perhaps not as much as in the past but the market is much smaller than it was a few years ago, so the impact may be greater in the long run.

Packard predicts the U.S. economy, and domestic steel, will bounce back but not until late next year or early 2010.

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