The recent pandemic has worsened the situation of a sector that has long suffered from a lack of a global level playing field. Half of Europe’s steel capacity and thousands of jobs are at risk. European steelworkers and their unions, coordinated by industriAll Europe, have developed a blueprint for a new European steel action plan and are addressing clear demands to national governments, the EU and steel companies.
According to the European Commission’s Spring forecast, the COVID-19 crisis risks 4.7m redundancies across Europe. And the second wave will increase this risk. This creates a massive challenge for unions, business and government. IndustriAll European Trade Union, representing workers across Europe’s manufacturing, mining and energy sectors, is witnessing first-hand the devastating impact of the COVID-19 crisis on our members.
The pandemic has accelerated and intensified existing structural changes due to decarbonisation and digitalisation in our sectors. It has also significantly increased the pressure on sectors suffering from the negative sides of globalisation and lack of a level playing field. In this context, the European steel sector has been hit particularly hard. It has long been suffering from unfair trade and global overcapacity and the recent COVID-19 pandemic has further worsened an already struggling sector. Without urgent targeted action, we risk losing half of Europe’s steel capacity and thousands of jobs through this crisis. We know from experience that once gone, it is extremely hard to recover industrial production. At the same time, the pandemic has shown the need for strategic autonomy.
There is a strong case to support the European steel industry. Steel is a foundation industry and as such it will play a key role in Europe’s recovery post COVID-19. Steel is crucial to achieve our climate ambitions and the aims set out in the European Green Deal. We need it for the transformation of our transport systems, the modernisation of energy networks, the deployment of renewable energies and for the refurbishment of buildings to become more energy efficient. Whilst more investment and innovation are needed to lower CO2 emissions in steel production, steel is already a poster child of the circular economy. 85% of steel is already re-used and it can become 100% recyclable.
COVID-19 has had a huge impact on the European steel sector. Steel production in Europe has reduced by 40% for the second quarter and new orders have been cut by 70-75%. It is estimated that at least 45% of the workforce are subjected to temporary layoffs and short time working. We have genuine concerns for the future of the sector post COVID-19 as around 50% of steelmaking capacity could be lost by the end of this pandemic.
The situation of the European steel sector is particularly vulnerable in this global crisis. Its main competitor China managed to increase its production by 1,3% in the first quarter of 2020. There are real concerns that some countries will use the COVID-19 pandemic as an opportunity to build up capacities, increase their stockpiles and flood the European market with cheap steel. This must be avoided.
A European steel action plan
Given these challenges, European steel workers and their trade unions, under the umbrella of industriAll Europe, have developed a blueprint for a European steel action plan. It is a plan with a clear and simple goal: A sustainable future for the European steel industry and for steel jobs in Europe. Our key demands include the need to invest in European steel plants and the decarbonisation of the sector, ensuring fair international trade and implementing fair trade defence measures as well as ending global overcapacity. Crucially, the recovery of the European steel industry will depend on its workforce. Investment in upskilling and reskilling of workers, ensuring the highest health and safety standards, guaranteeing good working conditions and rights for all workers, including temporary workers and subcontractors, will therefore be paramount.
In 2013, the European Commission released a Steel Action Plan and set up a High-Level Group on Steel. The action plan covered areas such as boosting demand for steel and creating a level playing field in terms of access to raw materials and trade, and it certainly supported the recovery of the steel industry at the time. However, European steel production is again in a very critical situation and we need a new European Steel Action Plan to tackle today’s challenges, paying special attention to the impact of COVID-19.
Campaigning for steel jobs and a sustainable future for European steel
Since this summer, steel workers and their unions have engaged in a Europe-wide campaign to put our detailed demands to EU policy makers, national governments, and companies. Our campaign culminated in a European steel action day on 1 October 2020. Despite the constraints of Covid-19, member organisations in every EU steel producing country participated with an array of actions, fully respecting social distancing requirements.
National activities ranged from demonstrations; high-level panel discussions involving politicians, trade union leaders, works councilors and top-level company management; regional social dialogue meetings; trade union sectoral conferences; meetings with national ministers; numerous press activities as well as lively social media campaigns.
We were also enormously grateful to receive direct support from various Members of the European Parliament, several governments, the President and the workers group of the European Economic and Social Committee and our sister organisation industriALL Global Union.
In the run-up to the action day, industriAll Europe had engaged in various meetings and lobbying activities. We met with the cabinets of European Commissioners, Members of the European Parliament, representatives of the German EU Presidency and discussed with the European steel employers’ association Eurofer.
EU Competitiveness Council
The challenges facing the European steel sector are evident and our attention is now turned to the EU Competition Council which takes place today, 19 November 2020. Steel workers and their unions expect ministers meeting in the council to decide on a new European steel action plan that will enable the sector to play its role in the recovery of the European economy and in achieving our climate ambitions. A plan, that must be underpinned by strong social dialogue and partnership.
Steel needs Europe and Europe most definitely will need steel. We want it to be clean steel, produced in Europe and supporting good quality jobs in our steel communities. Now is the time to act.