TATA is to cut 44 jobs in the North East as part of a national programme of 900 redundancies under plans to improve competitiveness.
Most of the job losses will be in South Wales, including 500 at the Port Talbot plant, under restructuring of management and administrative posts.
In the North East, 90 jobs will go at its 42” mill in Hartlepool and 14 in Gateshead, although this will be offset by 60 positions being created at its Teesside Distribution Centre alongside its Teesside Beam Mill.
Services offered at the company’s Gateshead distribution centre on Chainbridge Road will move to the Teesside site.
The Hartlepool pipe manufacturer is currently completing production of a significant order for the Gulf of Mexico, but only limited new orders have been secured for the 42” mill beyond February.
The firm said that the mill was project-based, which means it typically supplies large quantities of pipes to a few customers at any one time. It said this necessitates operating with a manning system which is responsive to changing market conditions.
Remco Blaauw, managing director of Tubes, Tata Steel, said: “The proposals being announced are necessary to match employee numbers to order levels from mid-February 2013.
“Whilst we have made every effort to secure new orders, the reduced number of tenders for major off-shore oil and gas pipelines over the past 12 months means there is not enough demand for our products to maintain current employee levels. We do forecast that the order load will recover in the second half of 2013. However, this is dependent upon new investment by oil and gas companies worldwide.
“The project nature of our business means that it is normal for manning and shift levels to be adjusted in line with workload requirements.
“Over the coming weeks, our priority will be to help our employees through this difficult process and offer them the advice and support they need during these uncertain times.”
These proposals do not affect the 20” or 84” tube mills located on the same site in Hartlepool, which make different diameter steel tubes for a range of markets.
Karl Kohler, chief executive of Tata Steel’s European operations, said: “These proposals are part of a strategy to transform ourselves into an all-weather steel producer, capable of succeeding in difficult economic conditions.
“These restructuring proposals will help make our business more successful and sustainable, but the job losses are regrettable and I know this will be a difficult and unsettling time for the employees affected and their families.”
Tata said demand for steel in Europe had fallen by 25% since 2007 and was forecast to slump by another 10% this year.
The company, which employs 19,000 in its steel business in the UK, said it remained committed to investing in the business to help create long-term stability.
Michael Leahy, general secretary of the Community trade union, said: “We will be seeking an urgent meeting with the company to ensure our principle of no compulsory redundancies is upheld, although we are pleased to see the company has already committed to offering a package of training and support for those affected by these changes.
“Sadly, these potential job losses are symptomatic of the continuing failure of the Government’s economic policy and yet another reason why we are calling on the British Government to take urgent action to stimulate economic growth and help revive the manufacturing sector.
“This announcement comes after a four-year-long downturn in the UK and European steel industry, where the fall in UK steel demand has been steeper than in any other major European economy.
“This is why we need faster investment in infrastructure programmes and community benefit clauses in UK procurement, just as France and Germany do to support their own manufacturing industry.”
