I believe that residents of Ontario and Canada need to look with a great deal of intrepidation at last evening’s announcement of layoffs and ‘temporary closure’ of Hamilton, Ontario’s Stelco’s Hamilton Works and Nanticoke (Lake Erie) Works.  U.S. Steel purchased Stelco about 18 months ago.  Stelco’s Nanticoke works is the newest (or one of the newest) and most efficient integrated steel mills in North America.  Stelco’s Hamilton Works (in continuous operation for over 100 years) is far from being the world’s most efficient steel producer, yet continues to be an important employer in one of Canada’s largest cities.  Apparently about 1,500 people will be laid off, with about 200 workers continuing to be employed to run the Coke Oven at Nanticoke which is the only part of Stelco’s operations that will remain open.

While I have on several occasions in prior posts commented on my concern with respect to the possibility of the U.S. automakers pulling their assembly operations out of Ontario and Quebec back into American assembly plants, I completely overlooked the possibility of U.S. Steel effectively pulling steel production back into the U.S.  I have little doubt this makes economic sense from U.S. Steel’s perspective.  I also have little doubt this event should cause more than a little concern in the Federal and Provincial Parliament Buildings - and among those of us who live in Ontario (and Canada).  From my point of view, it is not the event itself that is particularly concerning, it is the broader concept of retraction of jobs from Canadian subsidiaries by their U.S. parent companies that I think is the concern.

There is an article in today’s Globe and Mail covering this story.  You can read it by clicking here.

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