Wednesday, March 4, 2009

Haldimand "Do you Feel Secure?"

The announcement yesterday from US Steel was a surprise for many out there. But for some like a very close friend of ours that has worked at Stelco for 33 years knew that something was in the wind. It all started back in the fall when his department closed down. He had been an overhead crane operator for years and when his department closed down he went to stores. After a very short time in stores he went to the coke ovens and knew that his days were numbered. Luckily for our friend he has enough time in at Stelco to retire. Now this is not exactly what they had planned, but it is better financially for him to retire then to collect EI.

Stelco was bought out by an American company back a year or so ago. This purchase by US Steel stopped the closure of Stelco at that time. From an article that I will post below, there seems to have been some kind of legislation or rules as to a foreign company buying out a Canadian company. This information is confidential but it makes you wonder what the hell is really going on.

With the economic times of today no one seems to feel secure in their jobs, and when news like this hits the press it scares people even more. What happens when people are afraid of losing their jobs? They stop spending money. What makes the economy healthy? People spending their money.

The Federal and Provincial governments both have a stimulus package coming out that is going to drive us into huge deficits. When this money starts flowing is it going to help?

Canada's banks are now rated number one in the world. We are being told that the recession started outside of Canada and has pulled us in. I understand that part but what I don't understand is how the governments are dealing with the problem. The larger companies that are asking for financial support on the most part are not Canadian owned companies. They are foreign companies with Canadian connections. So did the government not see this one coming? When the larger companies shut down or downsize there is a domino effect that hits the "Canadian" Manufacturing companies.

I am not an economist nor an expert on business finances, but what I am pretty sure of is that when people stop spending money the economy feels the crunch. So my suggestion is that all money from upper levels of government should go to only two things; Infrastructure, and money in our pockets! No money to big companies! Money to big companies is not going to make you and I go out and buy a home or a car or any big ticket item. Will these companies that the government helps send the savings down to the consumer? In my opinion, No!

One idea that I had was for those out there that have spent years investing in RRSP's be given the option of cashing in $25,000.00 without penalty and without having to pay the taxes! Think of what that would do for the economy. How many people do you know would take advantage of that stimulus? I know I would.

In Haldimand-Norfolk, it's hoped pain is temporary
March 04, 2009
Lisa Grace Marr
The Hamilton Spectator

Andrew Schneider, owner of the iconic Erie Beach Hotel in Port Dover, is crossing his fingers hoping that when U.S. Steel says temporary layoffs, it means it.

"What does temporary mean? Two weeks? Two months or years? It's (a lot) of families and good jobs, the kind with benefits and all the things you need to support a family these days."
Schneider, past president of the Port Dover Board of Trade, was just digesting the news of layoffs of 1,500 jobs at U.S. Steel's Hamilton and Lake Erie operations announced late yesterday.

The move will affect 786 jobs in a rural, sparsely populated region with few employers the size of U.S. Steel. "It's a big hit right now."

U.S. Steel is listed as the biggest private sector employer on Haldimand County's website.
Haldimand-Norfolk MP Diane Finley, who is also minister of human resources and skills development, said she was "very disappointed" to hear of the layoffs.

Finley said Service Canada officials have already met with U.S. Steel to discuss what programs and benefits are possible for affected workers.

"Where there are mass layoffs, (Service Canada) always offers to go in and tell them what are the options, especially in light of some of the new options," she said.

Haldimand County Mayor Marie Trainer said she was shocked to learn of the layoffs yesterday afternoon when a U.S. Steel executive informed her of the move.

"He sounded very positive and said things will get back to normal once the economy and the European market bounce back," she said.

U.S. Steel has said it intends to temporarily close down its Lake Erie plant but keep its coke ovens running.

Norfolk County Mayor Dennis Travale said the news would be terrible for the area, because of its wide-ranging impact.

Travale said he, Finley and Haldimand-Norfolk MPP Toby Barrett were to give a talk at the Simcoe Chamber of Commerce on Friday on the state of the economy.

"I was going to try and be upbeat. I guess I'll have to rewrite my speech," Travale said.

Trainer said the layoffs will be particularly difficult to bear in Caledonia, which is experiencing a lag in development owing to uncertainty brought on by native land claims and protests. "It will have a real trickle-down effect for county businesses, everything from mom and pop to large grocery stores."

Robert Cook, president of the Jarvis Board of Trade and owner of a garden store on Highway 6, said the former Stelco "has always been a good member of the community."

"If it's temporary and it puts the company into a better position, that's fine.

"If they need time to take a breather (from the economy), we would hope that helps with long-term stability."

Stelco Shutdown
Local - Stelco shut down, production to U.S.
Stelco shut down, production to U.S.
John Rennison

U.S, Steel announced Tuesday that it is shutting down operations in Hamilton and Lake Erie and transferring production south of the border.

John RennisonU.S, Steel announced Tuesday that it is shutting down operations in Hamilton and Lake Erie and transferring production south of the border.

United States Steel Corp., headquartered in Pittsburgh, Pa., is an integrated steel producer with major production operations in the U.S., Canada and central Europe and an annual raw steelmaking capability of 31.7 million net tons. The company manufactures a wide range of steel sheet and tubular products for the automotive, appliance, container, industrial machinery, construction and oil and gas industries.

Lake Erie Works Employs: 1,100
Location: Nanticoke, north shore of Lake Erie
Founded: 1980
Operations: Integrated mill produces high-quality hot rolled sheet steel and slabs.

Hamilton Works
Employs: 1,700
Location: Burlington Street, Hamilton
Founded: The Steel Company of Canada is formed in 1910 by the amalgamation of five companies. It officially becomes Stelco in 1980. The company goes into bankruptcy protection in 2004 and emerges in 2006. It was bought by U.S. Steel in 2007.
Operations: Primary iron and steelmaking, plus finishing operations, including two pickle lines, a tandem cold mill, three coating lines, cold sheet finishing, a billet mill and a bar mill.
1,500 lose jobs in U.S. Steel cost cutting

Another 700 were already laid off
March 04, 2009 Naomi Powell
The Hamilton Spectator(Mar 4, 2009)

U.S. Steel is shutting down all operations at the former Stelco, putting 1,500 employees in Hamilton and Nanticoke out of work indefinitely.

In a city that has always looked to steel as its backbone, it is the most devastating indicator yet of a deepening economic crisis that has already battered Hamilton's struggling manufacturing sector.

The latest cuts come on top of 684 layoffs that have already been delivered at U.S. Steel Canada, bringing the total number of job losses to 2,190. No salaried staff were affected.

"This is going to devastate Hamilton," said Rolf Gerstenberger, president of the United Steelworkers union in Hamilton. "You lay off hundreds of thousands of steelworkers in Hamilton and North America and this crisis will just get worse."

Hamilton Steel and Lake Erie Works in Nanticoke will be mothballed over the next few weeks as U.S. Steel concentrates production at plants in Alabama, Pittsburgh and Indiana. Only the coke ovens at Lake Erie Works will continue to run.

The Canadian plants -- bought by U.S. Steel for $1.9 billion less than 16 months ago -- will not resume production until market conditions improve.

In Ottawa, officials are "watching the situation closely" to ensure it complies with the Investment Canada Act, said Pema Lhalungpa, an aide to Industry Minister Tony Clement. To get approval from Ottawa, a foreign company looking to buy a Canadian company must agree to "undertakings," which specify the net benefit the firm will provide to Canada in employment, investment or other contributions.

"Should an undertaking be compromised, we look at all options available to the government under the act," Lhalungpa said. She added that confidentiality rules prevent her from discussing U.S. Steel.

In Hamilton, Gerstenberger said he was angered that U.S. Steel had taken such a damaging step so soon after buying the former Stelco.

"Not that long ago, they were telling me how lucky we were to have U.S. Steel buy us," he said.

"Now a year and four months later we're shut down completely. We were the last Canadian steel company and now all the decisions are being made outside the country as far as what's good for Hamilton and what's good for Canada."

The steel industry is battling the worst downturn in demand in decades. Orders have dried up from manufacturers of cars, appliances and machinery, and steel prices have collapsed, prompting steelmakers to slash production and staff.

U.S. Steel has already shut down operations at its steelmaking and mining operations in Texas, Michigan, Minnesota and Illinois. U.S. Steel spokesperson Chuck Rice said there was "no way of knowing" when the steel market might pick up.

"I don't think there's anything parallel to this economic environment," he said last night. "Our primary customers in the auto industry and the appliance industry, well you can see what struggles they're having."

He said the move would not lead to a permanent shutdown of the older, less efficient Hamilton Steel operation.

"It's an integral part of the operation," he said. The shutdowns are expected to take a heavy toll on Hamilton's economy, hitting companies far beyond the plant gates, including local firms that transport steel and perform maintenance on machinery.

"For the local people this will be quite a blow," said Bill Ferguson, leader of the United Steelworkers union in Lake Erie. "This plant, Lake Erie, has never shut down in its history."

Workers and community leaders were stunned by the news yesterday, which include 786 layoffs at Lake Erie Works and 720 further cuts at Hamilton Steel.

Mayor Fred Eisenberger said he got a call from a U.S. Steel Canada representative yesterday afternoon to warn him about the impending job losses.

"I was stunned," he said, noting he has family who works at the company, a connection he suspects many Hamiltonians also have. "It's hitting pretty close to home."

Eisenberger said he's urging the federal government to deal with its employment insurance issues quickly. He added that the temporary shut down "screams out" for the need for immediate infrastructure spending to help the troubled economy.

"The good news is this is not a shutdown, this is an idling," he said. "This is not the end of the steel industry in Hamilton."

New Democrat Paul Miller (Hamilton East-Stoney Creek) worked for 32 years at Stelco before entering politics.

"Stelco provided jobs that helped families pay off their mortgages and put their kids through school," he said. "I shudder at the economic toll this will take."

Premier Dalton McGuinty declined to comment. Ontario is in dire economic shape, due largely to the unravelling of the manufacturing sector that has seen steel, auto and other industries demolished. The province is due to post a record breaking deficit in the range of $18 billion later this month.

"This is terrible news for Hamilton and the Nanticoke community," said Ontario Economic Development Minister Michael Bryant. "It is our hope that they will be back up ... and we want to explore every opportunity to see how we can make a contribution to get there."
ArcelorMittal Dofasco has yet to lay off any permanent employees, though it has cut the equivalent of 500 full-time workers through reductions in overtime and contract workers.


  1. I vote for your stimulus package Donna.

    The RRSP part is a great idea, why doesn't the government see things this way?

  2. Want stimulus? Get rid the GST and bring that underground economy to the surface.

  3. A comment was made today by a representative from the Degroot School of Business regarding U.S. Steel.

    His comment was that if the government wants to help the ailing automotive, appliance and steel industries what they need to do is remove the GST and PST on automobiles and appliances until the economy and the industries recover.

    Further I would suggest to the car companies that they need to suck it up when it comes to prices on their cars and reduce the price by $5 to $10 thousand dollars a car to get the inventory moving again.

    That is how you help an industry recover. As one of the union members said today 90% of the steel goes to the automotive industry. Stimulus plans such as building bridges will have a minimal effect on the steel industry and will do nothing to get the automotive and appliance industries moving again.

  4. This 'D%$&#$%^&^' is going to drag on for many years. Some analists expect that no significant economic recovery will surface until 2015 or even later.

    So, being that so many of the older generation of empolyees are out now of work, and not likely to return to the work force for many years, or if at all, So, if you're now 50 to 55 years old, your next income may be in the form of Canada Pension when you become 60+ and are still unemployed.

    My suggestion to the feds is to lower the minimum age to apply for CP from the current 60-70 down to 50-60 to stimulate employement opportunity for the younger work force.

  5. To the above comment regarding high vehicle costs and the 'stimulous for nothing' mentality that the north american auto company's have bilked the tax payers for the past 50 years. The government should demand and the auto sector should impose a wage cap on auto workers that make more than double minimum wage. In my experience within the automotive sector, auto workers do nothing out of the ordinary that justifies their outragiously overinflated wages.

  6. Unions will fight any wage caps or benefit reductions. This is a problem for most workers becasue if you ask them they don't agree with the Union. If it was up to the worker they would keep their jobs for less money, there is no other option that is better.

    No one is going to buy a new car if they don't have a job or if they are afraid of losing their job, so what help if any is a handout from the government?

  7. Thanks for your comments everyone.

    Stelco ripples already being felt

    March 04, 2009
    Emma Reilly
    The Hamilton Spectator

    Hamilton Mayor Fred Eisenberger says the shock waves of U.S. Steel’s decision to mothball the Hamilton and Nanticoke plants will go deep into the community.

    From the malls to the corner store, the economic shock of lost wages will be felt by many, he told CHML Radio this morning.

    An analyst says the idling of two blast furnaces at U.S. Steel’s Hamilton-area mills suggests the steelmaker expects production be shut down for a minimum of six months to a year.

    Steel industry expert Peter Warrian says the idling of a blast furnace is a complex job that costs several millions of dollars. He says the process to shut down and restart a blast furnace can take as long as a year.

    The ripples of U.S. Steel’s closure are already touching businesses in the city’s North End.

    Elaine Bambury, co-owner of Two Cougars and a Café on Burlington Street, said she was “devastated” when she heard the news of the closure last night. Much of her business comes from U.S. Steel employees and contractors working for the plant.

    Usually, she says her café is packed with people on weekday mornings. This morning, her restaurant was almost empty.

    “I hope to God it’s just an off day,” she said.

    Jonathan Riley, owner of S.D. Cohen Machinery on Hillyard Street North, says his business will be affected by the closure even though he doesn’t deal directly with U.S. Steel. Riley buys and sells machine tools to companies who work with U.S. Steel — companies whose major business partner is now closed.

    “There will be fewer and fewer machine shops in the area,” he said. “Doors will be closing. The market will get smaller and smaller.”

    Eisenberger said no one has any idea how long the mills will be shuttered.

    “We’re just going to do the best we can,” he said, adding this is not the time for any level of government or management and labour to try to make “political points” about the economy.

    “The thing to do now is try to bolster the economy.”

    Eisenberger also said he has been assured U.S. Steel’s closure of the Stelco Hamilton and Nanticoke plants is “a blip,” the company must endure to ensure it survives the global economic downturn.

    Eisenberger told CHML Radio this morning he has been assured by US Steel it will honour its commitments to both Stelco pensioners and employees.

    Eisenberger says he will be talking to Infrastructure Minister John Baird later today to ask for assistance.

    Getting a federal stimulus package up and running quickly is crucial, Eisenberger said.

    The mayor also said he will be contacting Ontario Minister of Economic Development Michael Bryant as well.

    Eisenberger said he got a call from a U.S. Steel official at 2 p.m. Tuesday an hour before the company made the announcement about an indefinite closure.

    “I was kind of stunned,” he said, adding he had the same reaction as many Hamilton and area families.

    “My brother is impacted,” he said.

    With files from Spectator staff

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