ActionSA has raised concerns over the decision to cut jobs at ArcelorMittal’s operations in Newcastle and Vereeniging, a move expected to result in 3 500 jobs.
Alan Beesley, the ActionSA MP, blamed the retrenchment process on South Africa’s industrial and economic policies.
ArcelorMittal, South Africa’s largest steel producer, announced plans to retrench workers due to prolonged weak economic conditions, logistical and energy challenges, and unstable competition from low-cost imports.
In a memorandum, Kobus Verster, the ArcelorMittal SA CEO, said the upcoming times will be uncomfortable but most defining.
Closures will deepen SA’s unemployment crisis
“A Section 189 consultation process will commence, impacting approximately 35% of our workforce, including those at Newcastle Works, Vereeniging Works, and AMRAS, as well as certain roles in the flat steel susiness, corporate office, and care support services,” he said.
Beesley cautioned that if the steel factory closes, it will further worsen the country’s unemployment crisis, which already stands at a depressing 32.1%.
He said the closure’s impact is expected to also affect other industries and households and challenge hope of economic recovery.
“The challenges cited by ArcelorMittal are not unique to the steel industry. Prolonged weak economic conditions, unreliable infrastructure, and escalating energy costs are common to many sectors, raising the question: which South African industry or business will fail next?
“This closure lays bare the ineffectiveness of the current government.
“Despite promises of inclusive economic growth, the expanded cabinet has shown more interest in overseas travel and political posturing than in generating economic growth and creating jobs,” said Beesley.
Cabinet focused on political posturing
He also criticised the government’s lack of effective action, highlighting that despite promises of inclusive economic growth, the expanded cabinet is more focused on overseas travel and political posturing than on creating jobs or fostering economic stability.
ActionSA called for an urgent review and overhaul of South Africa’s industrial policies to ensure they are evidence-based and capable of addressing the country’s economic challenges.
Some of the policies referred to, including the price preference system and export duties, which have failed to support long-term industrial growth and stability, must be reassessed, the party said.
Irvin Jim, the general secretary of the National Union of Metalworkers of SA (Numsa), said the union will continue to fight against proposed retrenchments.
“Unless a solution is found to retain the current capacity, allowing these plants to close could be potentially catastrophic and would spell disaster for the manufacturing and industrialisation of our country,” said Jim.
“This would have a direct negative impact on the community in Sedibeng and in Newcastle, where these plants are located.
“That is why Numsa has no choice but to fight back in defence of these plants in order to defend the jobs of our members.
“We cannot allow even more workers to lose their jobs unnecessarily if something can be done.
“We all have a responsibility to protect jobs, particularly because we have an extremely high unemployment rate and the highest levels of inequality in the world.”
