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Pandemic-led slowdown leads to job cuts at Sault steelmaker

Algoma Steel will lay off 70 employees
20160603 Essar Steel Algoma KA 01
As COVID-19 slows the market for steel Sault Ste. Marie's Algoma Steel is temporarily laying off 70 workers. (Kenneth Armstrong/SooToday)

Algoma Steel is blaming the impact of the COVID-19 pandemic for the loss of 70 jobs at its Sault Ste. Marie plant.

On April 30, the steelmaker said it would temporarily lay off 70 full-time hourly and salaried personnel, while another 80 to 90 employees would displace full- and part-time contract personnel.

In a news release, Algoma Steel said it made the move because of unstable market conditions, which weren’t expected to improve any time soon.

CEO Michael McQuade called it a “difficult decision.”

“As a steel producer, we are an essential service and we do not take that responsibility lightly. We continue to serve the needs of our customers by delivering quality steel products,” he said in the release.

“Our first priority is to operate safely, ensuring the wellbeing of everyone in our workplace.

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“We recognize the impact of this decision on our employees, their families, and the community,” McQuade added.

“Algoma Steel will continue to monitor market conditions closely, and may make further adjustments as the business may require. We are taking a responsible approach today to ensure the sustainability of Algoma Steel tomorrow.”

After emerging from three years of creditor protection in November 2018, the company had been in the midst of a $300-million investment to update its facilities.

But construction on its second ladle metallurgy furnace was paused earlier this month after a provincial order called for a stop on all non-essential construction projects in order to help slow the spread of the coronavirus.

The new furnace was on track to help the facility offer improved steel grades and refine an additional 100,000 tons of steel annually.

In operation since 1901, Algoma Steel produces hot and cold rolled steel products for the automotive, construction, energy, defence, and manufacturing industries.

The company employs 2,900 people across divisions.