U.S. Steel Corp. announced this week that it will close a mill near Detroit, laying off more than 1,500 workers as it tries to address financial losses.
The news comes just months after U.S. Steel announced it would be laying off 200 workers at the same mill, Great Lakes Works.
U.S. Steel said they expect to end the mill’s iron and steelmaking operations by April 1, 2020, with another part of the mill closing by the end of 2020. The estimated job loss is 1,545 workers.{mosads}
Steel production will instead be shifted to a plant in Gary, Ind., where the company has invested $750 million after both the city and state gave U.S. Steel tax breaks. Those tax breaks aimed to keep at least 3,875 jobs at the plant.
The changes, along with a plan to slash its dividend and suspend stock repurchases, come as the company predicts major losses in the fourth quarter of the year. According to MarketWatch, U.S. Steel reported an adjusted loss of $1.15 a share in the fourth quarter. The number is far more than analysts’ original projection, which put losses at 62 cents a share.
“We are conscious of the impact this decision will have on our employees, their families, and the local community, and we are announcing it now to provide them with as much time as possible to prepare for this transition,” CEO David Burritt said in a press release.
“These decisions are never easy, nor are they taken lightly. However, we must responsibly manage our resources while also strengthening our company’s long-term future – a future many stakeholders depend on. We will be taking steps in the weeks and months ahead to assist impacted employees by providing additional education about benefits available through our company, as well as community resources.”
The announcement comes as steel has been at the center of President Trump’s ongoing trade war with China. After the first round of tariffs, the White House celebrated domestic steel price increases and Trump said tariffs were rebuilding the industry, but the prices have since seen a sharp decline.
The U.S. and China have closed in on a new trade deal this month, and are working out the final details. Officials said the deal involves lifting some U.S. tariffs on China, while Beijing has agreed to purchase more agricultural products from the U.S.