Concerns rise as ArcelorMittal announces major job losses

Failure to manage the privatisation of State-owned enterprises and a lack of political will are some of the reasons trade unions and political parties have raised as key factors in the monumental job losses affecting various industries in South Africa.

With more than 4,000 jobs set to be lost as part of the retrenchments at South Africa's largest steel producer, ArcelorMittal South Africa, the Minister of Employment and Labour, Nomakhosazana Meth, has raised her concerns over the resurgence in job losses in the country.

Ahead of the retrenchments, the steel giant stated that talks with the government to find alternative solutions have stalled.

The company has blamed this on the government's failure to resolve long-standing structural problems, including high electricity costs, limited tariff protection, rising imports, and the worsening performance of the country's rail system.

"The (retrenchment) consultation process is a result of the continuing economic pressures facing the South African ferrochrome industry and the lack of sustainable industry solutions that could alleviate the pressures in the near to medium term," the steel company said in a recent statement.

In a statement on Tuesday, Meth stated that these job losses, in light of the job losses at Good Year SA and Ford Motor Company, and other entities, are deeply concerning.

"ArcelorMittal South Africa (AMSA) is set to shut down by the end of September, resulting in an estimated 3,500 job losses and a further 100,000 jobs downstream. Ford Motor Company of SA has also announced plans to cut 474 jobs at two of its plants in the country, with 391 operator positions at the Silverton Assembly plant in Pretoria, 73 at the Struandale engine plant in Gqeberha, and 10 administrative roles at both facilities.

"This comes shortly after the closure of the Good Year tyre producer due to a global restructuring, which resulted in the loss of 900 jobs and many other similar retrenchments announced in the vehicle and mining sectors in the recent past. Unfortunately, the department did not receive an application from Good Year SA, and as a result, we were unable to intervene," she said.

However, reacting to the latest developments, South African Federation of Trade Unions (SAFTU) spokesperson, Newton Masuku, accused the government of having betrayed the country's sovereignty when it decided to privatise the steel company formerly known as ISCOR.

"The current disaster stems directly from the apartheid regime's privatisation of ISCOR in 1989. Successive democratic governments failed to reverse this betrayal, leaving our steel industry under foreign corporate control.

"Since then, tens of thousands of jobs have been wiped out. Vanderbijlpark alone has lost 10,000 jobs since 1990. Now with Newcastle and Vereeniging set for closure, another 4,000 workers face retrenchment, while downstream industries and communities stand on the edge of collapse," said Masuku.

On Tuesday, the Economic Freedom Fighters (EFF) decried the looming job losses, saying this catastrophic development is not an isolated incident but part of a devastating pattern.

"In recent months, Glencore has entered consultations to shed thousands of jobs in the ferrochrome sector, Ford is considering retrenchments in its local operations, and Assmang is contemplating closing its Beeshoek mine after losing ArcelorMittal as a customer. What we are witnessing is the destruction of the little industry South Africa has left, a collapse that will hollow out communities and deepen mass unemployment," the party said.

siyabonga.sithole@inl.co.za