By Thapelo Molefe
Labour has vowed to do everything in its power to prevent 3500 workers from being retrenched following ArcelorMittal SA’s (AMSA) announcement that it will shut down its long steel mills in South Africa.
Not only would the closures impact jobs and families who relied on steel workers for income, it was bound to have a devastating impact on the economy, it said.
The closure of the operations has been on the cards since November 2023 amid prolonged weak economic conditions, logistics and energy challenges and competition from low-cost imports though it kept the Vereeniging and Newcastle factories operational after widespread stakeholder concerns.
Company CEO Kobus Versterhas confirmed that a Section 189 consultation process would begin, impacting workers at its Newcastle Works, Vereeniging Works and the Vanderbijlpark plant, along with other divisions.
The Congress of SA Trade Unions has described the closures as a catastrophe, especially given SA’s soaring unemployment rate of 41.9%.
“We simply cannot afford to lose another 3,500 jobs, plunging workers into instant poverty,” said Cosatu national spokesperson Zanele Sabela.
The federation called on the government to abandon its “neoliberal approach” and accelerate investments in Eskom, Transnet and other critical infrastructure to address the challenges cited by the company.
“Protective measures for mass employment industries are imperative,” Sabela said, emphasising the need for urgent action to prevent further economic devastation in the affected communities.
Numsa, SA’s largest metalworkers’ union, has vowed to resist the closures.
General secretary Irvin Jim criticised AMSA’s reliance on imported steel and called for a comprehensive dialogue involving the government, unions and other stakeholders.
“As a union, we will fight these proposed retrenchments because it is our duty to do everything possible to save jobs,” said Jim.
He called for state intervention to protect South Africa’s manufacturing capacity and warned of a broader economic collapse if AMSA’s closures proceeded.
Jim demanded transparency from the government, particularly the Presidency, regarding the breakdown in negotiations with AMSA.
“We need to understand the bigger picture so that we can act to protect this capacity, which cannot be destroyed,” he said.
The SA Federation of Trade Unions condemned the closures as a symptom of failed neoliberal policies dating back to the privatisation of ISCOR in 1989.
“The sale of ISCOR to ArcelorMittal turned a national asset into a corporate cash cow,” said Saftu general secretary Zwelinzima Vavi.
“Instead of strengthening domestic steel production, ArcelorMittal hollowed it out, leaving South Africa reliant on imports for over 70% of its steel needs.”
The federation warned of dire consequences for the Vaal Triangle, which has already suffered significant economic decline.
“The loss of… jobs in Vanderbijlpark will deepen the region’s crisis, exacerbate poverty and accelerate de-industrialisation,” Vavi warned.
Labour has collectively called for urgent government intervention to address the crisis, outlining a series of demands aimed at safeguarding jobs and rebuilding South Africa’s industrial capacity.
Numsa and Cosatu stressed the need for comprehensive industrial policies, and urged the government to invest in steel production, manufacturing and infrastructure to reduce reliance on imports and restore competitiveness.
All three emphasised the importance of protecting workers’ livelihoods through measures such as subsidies, alternative employment programmes and meaningful retrenchment consultations.
Additionally, Saftu has called for accountability from AMSA, demanding a thorough investigation into the company’s practices, including its reliance on imported steel and its failure to invest in local production.
“This is not just a corporate decision, it is a national crisis,” Vavi said.
“We cannot allow short-term profits to dictate the destruction of our economy.”
Jim echoed these sentiments, warning of catastrophic consequences for industries such as construction, automotive and mining.
“The collapse of local steel production would devastate value chains and destroy thousands more jobs,” he said.
Meanwhile, KwaZulu-Natal economic development MEC Musa Zondi, has also called for urgent national government intervention to prevent AMSA from closing its long steel business in Newcastle and Vereeniging.
“If not urgently addressed, the effects will stand beyond Newcastle posing a serious threat to the broader economy of KwaZulu-Natal. We are therefore calling on the national government to intervene and find solutions that protect jobs and sustain economic growth in the region,” he said.
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