Nation/World

As Trump touts steel’s resurgence, steelworkers move closer to a strike

PITTSBURGH - A major steelworker union has moved a step closer to striking, voting to authorize a labor stoppage that, if carried out, could derail the industry’s growth at a time when President Trump has touted its resurgence.

About 15,000 workers at plants owned by ArcelorMittal have unanimously voted to give the committee bargaining for new contracts here the right to call a strike within two days' notice, union officials said Sunday night. That followed a similarly unanimous vote to authorize a strike from about 16,000 workers of U.S. Steel.

Together, the two companies account for nearly 25 percent of U.S. steel production, and a strike could hold back the industry at a time when it is benefiting from federal intervention aimed at boosting production and employment.

The Trump administration has imposed tariffs on imported steel and aluminum, aiming to protect domestic producers from foreign competition. U.S. steel profits have surged over the last two years despite a downturn in 2015 and 2016, as prices fell in part because of an international oversupply coming from China, according to Phil Gibbes, a steel analyst at KeyBanc Capital Markets. The industry has rebounded in 2017 and 2018, in part because of the tariffs, with the prices of hot roll coil -- a key metric of steel prices -- jumping from $6.23 in 2017 to $8.44 in 2018.

Unions negotiating new contracts argue their members deserve a bigger share of the benefits.

They were already aggrieved over what they call stagnant wages, proposed increases to their health care costs, changes to overtime rules and other issues. Officials involved in bargaining said that recent negotiations have not gone well and that the sides remain far apart on significant matters, most notably proposed additional cost sharing for workers' health care plans.

“If I had to put a number on it there is a 90 percent chance” of a strike, said Thomas Conway, international vice president of the United Steelworkers, the union group representing workers at both companies in current negotiations. “Our people are pissed off. They understand the risk of this and what it means for their families.”

ADVERTISEMENT

Officials with ArcelorMittal and the U.S. Steel Corporation did not return a request for comment. The U.S. Steel Corporation said in a statement that the wage hikes are "significant" and amount to a 14 percent increase over a proposed 6-year agreement.

There is no hard deadline for talks to come to a conclusion, and it remains possible that a deal could be ironed out well before a strike. And the latest back-and-forth may amount to more “chest-pounding” than a real threat, Gibbes said.

The dispute threatens to unravel one of the justifications for Trump's sprawling trade war, which escalated on Sunday as the White House decided to impose an additional $200 billion of tariffs on Chinese goods. Tariffs on foreign steel imports have increased the price of steel and given domestic manufacturers a greater market share.

"The unions are seeing that the American steel companies are making a lot of money, and they want a piece of it," said Michael Manjuris, a steel expert at Ryerson University in Toronto, Canada.

Union officials downplay the extent to which Trump's tariffs account for the industry's rebound, pointing to strong growth before the tariffs took effect. They have instead pointed to lingering fury over large multi-million dollar bonuses taken by the top executives at the company, even as their pay stagnated during the industry's downturn in 2015.

“This is not a time members are seeking to have a dispute: They are just getting back on their feet and there is some new hiring going on,” said Conway, of the steelworkers union. “There is nothing logical about this and US Steel is very aware of that.”

ADVERTISEMENT