Tata Steel to axe 1,000 jobs in the UK

Tom Belger
Finance and policy reporter
The UK's largest steel works in Port Talbot, South Wales, which Indian owners Tata are looking to sell.

Tata Steel is planning to axe 1,000 jobs in the UK, as it struggles with the crisis engulfing steelmakers across the world.

The company said it needed to “accelerate innovation and the company’s journey towards carbon-neutral steelmaking.”

But the announcement will come as a huge blow to its workforce and suppliers, and could re-ignite debate about UK government support for the ailing industry in the middle of the general election campaign.

The company’s European arm did not confirm the location of the redundancies, but it currently employs around 8,000 people in Wales and its Port Talbot plant is the UK’s biggest steelworks.

Henrik Adam, its Europe chief executive, said: “I’m very proud to see the dedication of everyone in this business, determined to succeed even in the face of a very tough market. I also understand and appreciate colleagues’ concerns about these proposals.

READ MORE: Tata Steel warns over challenges as it wields the axe in Europe

“Change creates uncertainty, but we cannot afford to stand still as a company – the world around us is changing fast and we have to adapt. Our strategy is to build a strong and stable European business, capable of making significant investments needed for a successful future.”

David Rees, a Welsh Assembly member in Port Talbot, called for the company to reveal where the job cuts would land. “This uncertainty does not help steelworkers, their families and the wider community,” he tweeted.

Tata Steel said earlier this month that it was planning to cut around 3,000 jobs in Europe as part of a cost-cutting initiative. Up to 1,600 job losses are planned in the Netherlands.

It said that two-thirds of the losses would affect office-based workers.

“The programme is needed to ensure the business can thrive despite severe market headwinds which have led to a sharp decline in profitability,” Tata Steel said in a statement last week.

A sign on a roundabout advertises the Tata steelworks in Port Talbot. Photo: REUTERS/Rebecca Naden

The job cuts come after the company in September said that it would close its Orb Electrical Steels plant in Newport in South Wales, with the potential loss of up to 400 jobs.

The company’s European Works Council, which includes employee representatives from several countries and met with business leaders on Wednesday, said in a statement said cutting jobs “will not fix the problems” facing Tata Steel.

It vowed to fight compulsory redundancies, and claimed the plans “ignore the fact the current situation is above all the result of years of under-investment.”

The news comes at a challenging time for the wider European steel industry, which is struggling with US tariffs on EU steel, Chinese competition, and high energy bills.

The decline of sterling since the Brexit referendum has also affected the UK industry. British Steel, which was sold by Tata for £1 in 2016, collapsed into administration in May, and was sold on to Chinese industrial conglomerate Jingye for £70m earlier this month.

Tata last week pointed to trade conflicts and overcapacity, and said that Europe had become “a dumping ground for the world’s excess steel capacity.”

READ MORE: Could the UK still nationalise the steel industry?