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U.S. Steel idles steelmaking at Granite City plant, could lay off majority of workforce

A man looks for oncoming traffic as he leaves the U.S. Steel Works factory in Granite City
Tristen Rouse
St. Louis Public Radio
A man looks for oncoming traffic as he leaves the U.S. Steel Works factory in August in Granite City. U.S. Rep. Nikki Budzinski, D-Springfield, Ill., announced Tuesday that roughly 1,000 plant workers were told they could be laid off as steelmaking at the plant would be idled indefinitely.

Updated at 4:45 p.m. Nov. 28 with comments from local, state and federal officials

U.S. Steel announced Tuesday it will idle most of its Granite City Works plant, permanently laying off up to 1,000 workers.

The 1,000 workers include about 400 who have been on temporary layoff since Oct. 1 plus an additional 600. Prior to Tuesday’s layoffs, Granite City Works operated with roughly 900 employees, said Dan Simmons, president of United Steelworkers Local 1899. The layoff notices that went to an additional 600 employees could mean only 300 will remain in non-steelmaking operations.

The news is a massive blow to the Metro East community whose economic vitality is centered around the plant.

Tony Fuhrmann, director of Madison County’s Department of Employment and Training, said the county will offer services around the start of the year to the affected employees. For many workers, he said the transition will be tough.

“A lot of them are multigenerational,” Fuhrmann said. “They take a great deal of pride that they were steelworkers. Dad was a steelworker. Grandpa was a steelworker. So it's much more than losing a job. I mean, it's part of their family heritage that's been taken away.”

A spokeswoman for the Pittsburgh-based parent company said the layoffs were taken to ensure that the steel produced in Granite City matched the orders coming into the mill.

“U.S. Steel has indefinitely idled Granite City’s primary operations and will meet customer demand by leveraging the company’s active iron and steelmaking facilities,” company spokeswoman Amanda Malkowski wrote. “We thank our employees for their contributions and will keep them informed throughout this process.”

The employees soon to be laid off will have at least 60 days left on the job. The notice they received on Tuesday meets a requirement that large employers give at least 60 days' notice before layoffs. The exact number of employees who will lose their jobs is unclear.

“We anticipate that approximately 60% of employees who receive the notices will be impacted," Malkowski said.

In September, U.S. Steel announced temporary layoffs starting in October for roughly 400 employees, citing a downturn in demand caused by the monthlong strike by unions representing autoworkers at Ford, General Motors and Stellantis facilities.

Simmons had said little steel produced in Granite City is used for the auto industry production. Both he and Illinois U.S. Rep. Nikki Budzinski, D-Springfield, who represents the area, have expressed concern about U.S. Steel’s motivations.

“It’s clear that these layoffs were never about the market and always about targeting organized workers,” Budzinski said. “U.S. Steel must be held accountable.”

U.S. Steel has entertained bids to buy the whole company in the past couple of months. The company first rejected an unsolicited bid from a rival steel company in August. After receiving a few other offers, U.S. Steel allowed the rival company to participate in the potential sale process after signing a nondisclosure agreement.

The company also floated the idea of selling Granite City Works to neighboring SunCoke Energy Inc. in a deal that would permanently cut an estimated 1,000 jobs. However, the union has said it has the power to veto the deal, Simmons said.

Illinois state Sen. Erica Harriss, R-Edwardsville, said Tuesday’s layoffs are devastating for the entire community. The granddaughter of a steelworker, Harriss said the “excuses for the closures will offer little comfort to the people who rely on these good-paying jobs to support their families.”

“Our community helped build this company over generations,” she said. “U.S. Steel is turning its back on our workers, our community, and our state.”

Will Bauer is the Metro East reporter at St. Louis Public Radio.