ArcelorMittal to cut 1,000
jobs even in low-cost Poland
By Surender Bhutani
Warsaw,
Dec 4 (IANS) In what seems to be a deviation from its stated
policy to cut only non-production jobs and also an indication
of demand contraction worldwide, the world's largest steel
maker, the ArcelorMittal Group, has decided to cut 1,000 production
employees from its plants in Poland, which have the lowest
production costs among all group plants.
"The
job cuts have become necessary as demand has fallen sharply,"
ArcelorMittal Poland president Gregor Muenstermanna said.
The
company has submitted a request to the Labour Office here
to cut jobs in its Dobrowa Gornicza plant, Muenstermanna said.
"The
demand for steel from this plant has gone down by 10 percent
in October alone," he said.
Last
week, however, the company had announced that it would slash
up to 9,000 jobs across the globe, approximately three percent
of its total workforce, but they would be all non-production
jobs.
"The
focus is primarily on non-production employees, in particular
those in SG&A (selling, general and administrative) functions
across the globe," a company statement announcing the
job cuts had said.
The
job cuts would help achieve the company's stated aim of reducing
SG&A expenditure by $1 billion in response to the current
economic situation, the statement had said.
The
Polish job cuts are, however, those of production employees
as the company is cutting production in the face of falling
demand.
Moreover,
the company is preparing itself for even tougher times to
come when more jobs may have to go, Muenstermanna said.
"December
is, as a rule, a very poor month; so we should be prepared
for a further decrease in orders," he added.
The
job cuts are being seen as a worrying move also for another
reason.
A
Solidarity trade union leader Jerzy Goinski, told the Puls
Biznesu financial daily here that the cuts were a worrying
sign, considering that production costs in Poland were the
lowest in the entire ArcelorMittal group.
That
means global demand is so badly affected that ArcelorMittal
is being forced to cut production jobs even in its lowest
cost plants, a steel industry observer said.
ArcelorMittal
Poland controls four plants in the country - Krakow, Dobrowa
Gornicza, Sosnowiec and Swietochowiec. It has already shut
down its two large furnaces in Krakow and Dabrowa Gornicza.
The
Mittal group entered Poland in 2003 and has since then come
to control some 70 percent of steel production in this country.
It has invested more than four billion euros ($5.05 billion)
in Poland and till June this year it was making handsome profits
from its operations.
ArcelorMittal
is the world's largest steel maker with over 326,000 employees
in more than 60 countries and has an industrial presence in
over 20 countries spanning four continents. The company covers
all of the key steel markets, from emerging to mature ones.
Incidentally,
company chairman Lakshmi Mittal has reportedly lost more than
50 billion pounds ($73.7 billion) in the current financial
meltdown although the loss is notional as it refers to the
market value of the shares and other assets he owns.
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