Geneva Steel intends to lay off 220 more workers next week to save money in a sagging steel market.
The company placed 130 union steelworkers on furlough nearly two weeks ago. And if the market doesn't take an upturn, more employees will be out of work.Carl Ramnitz, vice president for human resources, said Geneva tried to avert another round of layoffs by reducing steelworkers from 40 hours a week to 32. "That didn't work," he said.
Geneva has had a difficult time keeping its order book full in recent months. It blames an influx of low-priced steel from Asia and Russia for decreasing demand for its steel plate and coil. The company, along with other U.S. steelmakers, intends to file an "anti-dumping" petition with the U.S. International Trade Commission, a tactic Geneva used last year to curtail what it believes are illegal imports.
"It's going to be awhile before things get better," Ramnitz said.
That's not good news for rank-and-file steelworkers. Union leaders, however, said two weeks ago the layoffs weren't a surprise. Ups and downs are part of the industry, they said, and workers are willing to ride it out.
The last two layoffs differ from previous job cuts. The company will monitor the steel market daily so those workers can be called back as soon as conditions improve.
"This is going to be week-by-week thing," Ramnitz said.
October is traditionally a month in which many workers take vacation for the annual deer hunt.
Ramnitz said that will allow the company to call some workers back to fill in. But if the market doesn't improve after October, Geneva will be looking at another "significant furlough," he said.
Geneva intends to permanently trim at least 500 employees from its work force by the end of the year as part of an ongoing restructuring effort to become more competitive. The cuts will save about $25 million.
Steel mills nationwide are suffering from poor fiscal performances. Earnings were down for 16 major mills, especially integrated mills like Geneva, over this time last year, according to Locker Associates, a New York firm that tracks the industry.