In less than six weeks the first of 800 workers to lose their jobs at BlueScope will walk out of the Port Kembla steelworks for the last time.Those at the No 6 blast furnace are likely to be first, with other workers to follow as the company shuts down a coke oven, a basic oxygen steelmaking furnace and one of the three continuous slab casters.Steelworkers arriving for the first shift at 6am yesterday got the news they'd feared - and many had known was coming - but the scale of the job cuts was double what many, including Illawarra unions, expected.BlueScope chief executive Paul O'Malley said employment search centres would be set up in a bid to help workers find jobs elsewhere.
BlueScope workers: the fear that became reality$30m package to assist regionSee the drama in pictures here800 jobs go at Port Kembla steelworksMr O'Malley announced a full-year loss of $1.054 billion for 2010-11, including a $922 million "impairment" largely related to the writedown of the value of the Australian steelmaking business.Major steelmaking assets will be closed as the result of a restructure of Australian operations that will allow BlueScope to exit the export market altogether.BlueScope will shut down the No 6 blast furnace at Port Kembla, halving steelmaking capacity to about 2.6 million tonnes a year. It will also close the No 4 coke-making battery, the No 3 basic oxygen steelmaking furnace and the No 1 slab caster. About 200 jobs will also go at BlueScope's Westernport plant in Victoria.The company will work with employees and unions to determine the details of how many jobs will go in each area. This process is underway.Some long-serving workers have already been offered early retirement but the newly redundant will be walking out of the steelworks for the last time in October."We will start to see people leaving the steelworks within the next two months," Mr O'Malley said.He said the company would do its best to treat workers "with absolute respect". With the industry in decline, many workers are expected to accept voluntary redundancy packages. But there will be forced redundancies as well.The restructure will cost BlueScope almost $500 million, about half of which will go to paying workers' entitlements.BlueScope has about 3100 employees at the steelworks and provides work for several hundred contractors.The writing had been on the wall for the steelworks for much of this year as the company buckled under the effects of a high Australian dollar and skyrocketing prices for iron ore and coking coal.Mr O'Malley said the wind-down had "nothing to do with the carbon tax". He said global steel production was at an all-time high, with 1.5 billion tonnes being produced - almost half of this in China."We are facing significant structural change in the globalised industry," he said. "Steelmaking is moving from being a developed world-produced product to a developing world-produced product. This year we've lost about $487 million on a fully-costed basis from being in the export business."Mr O'Malley said the cuts were necessary to get BlueScope back to profitability. He said the company had been making more money from its Asian operations than from its Australian businesses, but the reduction in input costs that would come from halving production would leave the company $225 million better off.The production cuts are expected to reduce BlueScope's carbon emissions by about 5 million tonnes a year.But the company will receive the full $180 million in taxpayers' money promised to it by the Federal Government under the carbon price package - an amount which was calculated to cover an expected higher carbon bill.The company does not expect to face industrial action from unions trying to fight the mass job cuts."I think we have been very transparent as to the macroeconomic factors," Mr O'Malley said."We will absolutely engage with our employees and all other stakeholders, including the unions, and I think the unions have come out today acknowledging the macroeconomic factors."So, as long as we deal with our people with respect and continue to focus transparently on the issues we're dealing with, I suspect that everyone should be in alignment to achieve this restructure as easily as possible without any barriers because that's the best thing for maximum employment, not only in the short term but in the medium term."BlueScope will not pay a dividend, with its shares continuing their steep decline yesterday to an all-time low of 74?.
