British Steel to cut 400 jobs as ‘weak pound’ sparks streamlining
British Steel has announced plans to cut 400 jobs as part of a streamlining process after being hit by the “weakening of the pound”.
The steel manufacturer said its raw materials were traded in dollars and a weaker pound and euro meant it needed to adapt.
It said no closures were being considered but that 400 managerial, professional and administrative roles would be cut at its operations in the UK, Ireland, France and the Netherlands.
Steel unions said it was a "body blow" to the workforce and called for the government to "step up" and support the industry.
British Steel runs the Scunthorpe Steelworks plant as well as facilities in Skinningrove, Teesside and Hayange in France.
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It was formed under its current guise in 2016 with assets acquired from Tata Steel Europe and Greybull Capital.
Chief financial officer, Gerald Reichmann, said: “We’ve made a strong start to life as British Steel but our external environment is constantly changing.
“For example, raw materials are all traded in US dollars, so the weakening of the pound and euro have implications for us.
“Like any business we need to be able to flex and adapt to these changes.”
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In the summer British Steel reported underlying earnings of £68m for the year – excluding a one-off £47m cost it is claiming insurance on – and also secured a profit of £47m in its first year under new ownership in 2017.
New 25 per cent tariffs on steel imports to the US introduced by Donald Trump earlier this year have hit the industry.
The company's executive chairman, Roland Junck, said: “The pace of change we need in this challenging industry requires further and continued investment along with more agile and efficient operations.
“To help us achieve this, we have to make difficult decisions and our plans unfortunately include the proposed reduction of 400 roles across our global workforce.”
The National Trade Union Steel Coordinating Committee said it was "disappointing" the company had decided to cut jobs after celebrating a successful second year.
It said: "This announcement will come as a body blow to the workforce who have already made huge sacrifices to make the business sustainable.
“We recognise these are challenging times for UK steelmakers, and it’s high time the government stepped up and delivered for us by supporting investment in strategic steel assets."
He added: “We’re sad to be making this announcement, particularly for our colleagues who could be affected.”