Home » UK Employment news » British Steel owner could cut about 2,000 jobs

British Steel owner could cut about 2,000 jobs

By Nithya Bose in UK Employment news, posted October 23, 2023

British Steel's Chinese owner is gearing up to cut nearly 2,000 jobs due to monthly losses believed to be around £30 million.

These reductions represent nearly half of the Scunthorpe-based company's 4,500 employees.

It’s part of a transition to more environmentally friendly steel production using electric arc furnaces instead of the polluting blast furnaces, which use coke to melt iron ore.

The company is still considering the cuts, and it hasn't reached any definitive decisions regarding the restructuring.

The UK government has offered £300 million to the company's owner, the Jingye Group, to support their shift to electric arc furnaces.

However, negotiations to finalise this agreement are ongoing, with the funds closely tied to job protection and a £1 billion investment by the Chinese conglomerate.

How the potential job reductions might impact the government's financial commitment remains uncertain.

Need Career Advice? Get employment skills advice at all levels of your career

The UK government recently agreed to a £500 million support package for Tata Steel to facilitate the transition to electric arc furnaces at the Port Talbot steelworks in Wales.

A spokesperson for the Department for Business and Trade said: “We continue to work closely with industry, including British Steel, to secure a sustainable and competitive future for the UK steel industry.”

The UK steel industry faces challenges from rising costs and competition from low-cost steel produced in China and other regions.

The UK’s steel industry has huge energy requirements and also uses coking coal in the iron smelting process, leading to carbon dioxide emissions.

It’s known for its substantial energy demands and the use of carbon-intensive coking coal in iron smelting.

Follow us on YouTube, Twitter, LinkedIn, and Facebook.