US Steel’s Great Lakes, Michigan facility is looking to lay off up to 200 workers, according to Fox Business. The good news is that they’re saying it’s a temporary move, the bad news is that it could be for six months or more before they rehire.
Despite President Trump’s push to require more US steel and iron on federal projects and 25% tariffs on steel imports, demand is down and prices are lower, resulting in a move by US Steel to idle two blast furnaces at Great Lakes and Gary Works.
According to a Reuters report, the price of hot-rolled steel coil is down some 37%. Initially, steel prices rose following tariff implementations, but higher supplies combined with a drop in demand from in agricultural equipment and automotive sectors are driving the lower prices currently.
US Steel’s stock prices have also dropped from near-$45 highs back in March 2018 to under $13 today. These are some of the lowest stock prices we’ve seen for US Steel since the early 1990’s.
The loss of jobs is a shift from the massive worker shortage we see in the trades today. However, manufacturing is a different business and it relies on the balance between supply and demand to be as profitable as possible. It’s not uncommon to see temporary layoffs during periods like this and we expect to see US Steel bounce back once the oversupply is used up and demand returns.
