No sooner had the ink dried on the landmark SSI deal, Teesside was reeling from a fresh blow to its steel industry. Mike Hughes reflects on a pivotal few weeks.

THE shiny new face of Teesside steel is looking a little tarnished. After the celebration of the SSI deal and the confidence that brought back to the region, the harsh reality has returned with the news of the Tata job losses.

Steel isn’t stainless after all. It is a strong industry with the power to exert some influence on its own markets, but it’s as vulnerable as any other to the first lesson we all learned in secondary school economics: supply and demand.

The latest figures from the RICS reveals that firms were hit by falling workloads and higher build costs in the first three months of the year. Eleven per cent more surveyors in the region reported a decline rather than a rise in activity, with private industrial and public non-housing sectors suffering the most.

Material costs continue to rise, with 62% more surveyors reporting a rise than a fall in prices – up from 56% in the previous quarter.

RICS said the findings highlighted “an extremely negative picture” for construction firms in the North East. The timing is a damaging element of Tata’s announcement. A year or two further on and it would still have been awful news, but wouldn’t have had the spotlight of the ‘good guys’ at SSI turned on it to the same blinding extent.

Tata’s long products operations at Lackenby and Skinningrove have suffered from a massive downturn in infrastructure investment and construction activity.

They are still a major employer in the region, even after the sale of Teesside Cast Products earlier this year.

The Indian-owned firm currently employs more than 1,800 workers locally, although that could fall to around 1,400 if the 390 jobs are shed.

Tata has several key operations on Teesside including the beam mill at Lackenby which has changed the world’s skyline in a history spanning more than half a century. It has worked on some of the world’s most iconic structures and supplied thousands of tonnes of steel beams for the Olympic Stadium in London.

Tata has three mills in Hartlepool (20-inch, 42-inch and 84-inch) making steel pipes and tubes for a variety of sectors including the oil and gas exploration industry.

The special profiles site at Skinningrove and Darlington makes special-shaped steel products for the shipbuilding, mining and renewable energy sectors.

In 2006 it became the first Tata Steel business to win a Queen’s Award for Enterprise.