Steel to shed 70,000 jobs

Tens of thousands of jobs will go in the European steel industry over the next five years as more companies succumb to takeovers and cut capacity along the lines of the proposed pounds 5bn merger between Krupp and Thyssen, writes Richard Halstead.

Analysts believe that between 60,000 and 70,000 jobs will go in EU steelmaking between now and 2002, reducing the number working in the industry to below 200,000 - the lowest since the industrial revolution.

Some of the job losses will come from British Steel, which on Friday said that it would be "accelerating" its planned job cuts from the current 500 to 1,000 per year, but denied that it would be cutting 10,000 jobs over the next five years - nearly a quarter of its workforce.

Industry figures said more mergers and redundancies would follow elsewhere. "The restructuring process has become permanent, with costs having to be cut at every turn to maintain competitiveness," said a spokesman for Eurofer, the European steel trade association.

Krupp and Thyssen remained locked in talks this weekend, but it seemed likely they would at least agree to merge their steel operations, if not their whole organisations. If a full-scale merger goes ahead, up to 10,000 of the 58,000 steelworkers in the new entity will face redundancy.