PORTAGE | Beta Steel has begun temporarily laying off almost half of its workers as demand for its steel has dropped, company and union officials said Saturday.
In what is being described as a plantwide work reduction, Beta Steel's work force is expected to begin fluctuating on a weekly basis between halted production to possible full staffing.
"It is a layoff because of the current market conditions. People aren't buying steel," company spokesman Joseph Gazarkiewicz said. "But it's temporary. We haven't closed doors."
Gazarkiewicz said starting today, the facility's staffing levels will be determined week by week, with some weeks expected to go without production and with a diminished staff.
"Some weeks, there will be a small crew. Some weeks, there will be full production," he said. "Hopefully by the first of the year, everything will be back to normal."
Beta produces hot rolled band, with 35 percent of its capacity sold to pipe and tube producers.
On a weekly basis, the layoff will affect an average 110 workers, or about half of the plant's 255 hourly workers represented by the International Longshoreman's Association, said Andre Joseph, vice president of ILA's Atlantic Coast District.
The roughly 80 people who make up maintenance and melt shop personnel are expected to work today, Joseph said. The staffing changes will affect mostly production and rolling mill employees, he said.
In a worst-case scenario, in the weeks when production halts with few people on-site, nearly all employees could be without work, Joseph said.
"It's tough, from a working man's point of view," the union official said.
Many Beta employees, most of whom reside in Lake and Porter counties, have watched as other steelworkers have lost their jobs to the slumping economy, Joseph said.
"As long as we're working, you think, 'I feel bad for those people,'" he said. "Next thing you know, you are those people. It comes right in to your own backyard."
As part of an agreement with the union, the steelmaker still will cover workers' insurance benefits, Joseph said.
Joseph said he hopes the layoff process lasts for no more than three months, during which time workers will be notified a week in advance of their schedule.
Last year, Beta sold 602,000 tons, with $324 million in revenue. Its earnings, before interest, taxes, depreciation and amortization, were $21 million.
In September, the company announced it was being purchased by Russian steelmaker Novolipetsk Steel in a $400 million all-cash deal, expected to close in the fourth quarter of this year.
Gazarkiewicz said the current layoffs neither were a result of the pending sale, nor would they affect the deal.
