The British Steel industry has been harmed as Chinese steel continues to out-compete the British market, where higher wages have made it more difficult for British manufacturers to remain price-competitive. Tata Steel directly employs 15,000 workers in its UK-based steel manufacturing operations, and as such these jobs are now under threat. What is more alarming is that the wider crisis could affect an estimated 40,000 jobs in total.
Sajid Javid, the current British Business Secretary, met with Port Talbot workers a couple of days ago to try and reassure workers that their jobs were safe. Tata, which has its headquarters in India, is considering what action it will now take seeing as the profitability of the British market has consistently dropped. The Business Secretary’s attempts of reassurance have centred on the notion that there would be “interested buyers” even if Tata did sell their British assets.
Although Labour leader Jeremy Corbyn has made comment on the crisis, stating “I would advocate some form of public intervention…the crucial thing is to preserve the steel industry in Britain”, the Conservative government’s attempts to rectify the crisis have been much more convoluted in nature.
David Cameron’s initial response was that nationalisation was not the appropriate path for his Government to follow, but Uncertainty over Tata’s plans has led to confusion. It seems that it would be unwise for Tata to simply sell up to a competitor because that would not be in their interests, but where does this leave the British workforce?
Steel production only makes up 1% of Britain’s manufacturing output and 0.1% of the country’s economic output. Yet this does not excuse the issue of how the crisis will affect the workforce and potential profitability of the British steel market as a whole.
The Government’s promise that it is doing “everything it can” to resolve the crisis has been called false by some. It has been revealed that although the Government is making moves to ensure that Steel remains profitable, Cameron was unable to block China’s decision to maintain high import tariffs on EU steel, despite meeting with Xinping personally to discuss the future of the two nation’s steel industries.
The issue is becoming more and more of a burden for the current Government. It has ignored the issue for too long and as such they did not introduce a long term plan to try and avoid these crises. Steel is an undeniably important product of the UK economy, and as such nationalisation is appearing more and more like the only option available at this current time.
The UK Steel crisis is a reflection of the larger dangers of allowing many transnational corporations near-autonomy over industries with crucial national importance. The British people deserve better and the British worker deserves better. Our interests should lie with the people of this country – they have a right of ownership of important services and industries.
Image credit: flickr.com/ben_salter