Tata Steel announces closure of blast furnaces in Britain, impacting up to 2,800 Jobs

Tata Steel revealed on Friday its decision to close two blast furnaces in Britain by the year’s end, resulting in potential job losses of up to 2,800 at its Port Talbot steelworks in Wales. The move is part of Tata Steel’s strategy to revamp its UK steelmaking business, pivoting towards lower carbon electric arc furnaces, supported by a government funding injection of £500 million ($634.10 million).

Approximately 2,500 roles are expected to be affected within the next 18 months, with an overall impact on 2,800 jobs. Tata Steel will initiate a consultation process as part of its restructuring efforts, aiming to maximize voluntary redundancies. CEO T V Narendran emphasized the difficulty of the decision but deemed it necessary for building a sustainable long-term business in the UK.

While Tata Steel employs over 8,000 people in the UK, the warning of potential redundancies arose in September when the government announced its funding package to safeguard 5,000 jobs. Trade unions Community, Unite, and GMB expressed their rejection of the Tata Steel plan, announcing plans to consult members on potential next steps, including industrial action.

The shift to electric arc furnaces, though environmentally beneficial, is anticipated to have a significant impact on the workforce. Tata Steel pledged a £130 million support package to aid affected employees in retraining and securing new jobs.

The transition to electric steelmaking is expected to reduce Britain’s carbon emissions by 1.5%, addressing environmental concerns associated with the coal-fired plant at Port Talbot, the country’s largest single carbon emitter. The government’s financial support for Tata Steel aimed to secure the future of the UK’s steel industry, mitigating the threat of complete plant closure due to daily losses of £1 million.

Critics argue that the shift towards electric arc furnaces, which use recycled scrap steel, may diminish the industry’s scale, especially as it contrasts with traditional methods of producing virgin steel from iron ore, coke, and other inputs. China-owned British Steel is also in talks with the government about transitioning to cleaner manufacturing, potentially impacting up to 2,000 jobs.