Corus, Europe's second-largest steelmaker, announced on Monday plans to cut 3,500 jobs as part of a new strategic initiative launched to enhance competitiveness. "It should bring annual improvements in operating profit of more than 200m pounds," the company said.
Corus currently employs about 42,000 people and a little over half of them are stationed in the United Kingdom.
A company spokesperson told Business Standard that jobs will be cut in three plants -- 1,100 in South Wales, 1,400 in the United Kingdom and another 1,000 in Holland.
Tata-owned Corus is the latest steel maker to announce downsizing of its workforce.
Faced with an economic slowdown, steel makers the world over are cutting output, cancelling investments and reducing their workforce. ArcelorMittal, the world's largest steel maker, plans to eliminate as many as 9,000 jobs and curtail production by a third.
Corus CEO Philippe Varin said the structural changes have been carefully considered and are essential for the future of the business.
"This will ensure Corus is in the best possible shape to compete strongly in the future," he said.
The new initiative includes sale of Corus' aluminium smelters in Germany and the Netherlands (announced on January 21) and sale of a majority stake in Teesside Cast Products.
The group proposes 'mothballing' of the Llanwern hot strip mill and the restructuring of engineering steels into two businesses -- a specialty steels business at Stocksbridge and a bar business at Rotherham.
Community, Corus union, in a strongly worded media release expressed its disappointment over the job cuts and said it will continue to hold dialogue with the company to avoid this.
"This announcement is a devastating blow to workers and contractors at Corus and will have a knock-on effect for thousands in steel communities across the UK," Michael J Leahy, general secretary of Community, said. "This is no reflection on the workforce, which has consistently delivered productivity improvements year-on-year."
Later, a Community spokesperson added that there will be dialogues with the management of Corus to ensure that the job cuts are either avoided or minimised.