Final Thoughts

Final thoughts

Written by Ethan Bernard

Following the United Auto Workers (UAW) union strike, organized labor is enjoying a moment.

After negotiating hefty raises for workers, UAW President Shawn Fain has made explicit his push to unionize non-union auto workers in the US. The question is, could something similar happen in steel?

Sometimes even things set in stone are liable to change. That brings us to U.S. Steel’s Granite City Works in southern Illinois, just across the state line from St. Louis. Whatever you might think of that transition, the mill has been around a long time. The plant started operations back in 1895 as Granite City Steel, according to Global Energy Monitor Wiki. It was purchased by U.S. Steel in 1927.

This week, the Pittsburgh-based steelmaker announced it would indefinitely idle steelmaking at the facility. In other words, the ‘B’ blast furnace, which was temporarily idled in September, will join the ‘A’ furnace in being indefinitely idled.

Recall that Granite City has two blast furnaces: ‘A’ and ‘B’. The ‘A’ furnace was indefinitely idled in April 2020, according to SMU’s blast furnace status table.

U.S. Steel also said in early October that it would lay off ~300 workers, a number that has since been reported to have grown to as many as 1,000 workers.

To gauge the impact on the United Steelworkers (USW) union, which represents Granite City, I spoke with the USW’s Mike Millsap on Thursday. He is the director for USW District 7, which serves workers in Indiana, Illinois, and Wisconsin.

I asked first about the elephant in the room, the potential sale of U.S. Steel. (See SMU managing editor Michael Cowden’s piece here.)

When I asked whether the idling at Granite City was related to any possible deal for U.S. Steel, Millsap said the events were “unrelated.”

He also said that though the figure of 1,000 layoffs was inflated. The actual number will be much lower. For starters, it includes the ~300 layoffs already announced.

“It’s not going to be a thousand people,” Millsap said.

I then asked him about the UAW strike, and if their push to unionize non-union workers could have a knock-on effect for steel and for the USW.

“We’ve been doing this for quite some time,” Millsap said. “Our union is diversified. We’ve got chemical, forestry, steel, aluminum, oil, schools – we’re just all over.”

“We’re always pushing and trying to get better at organizing and organizing the non-organized,” he added, noting organizing drives in tires and in steel.

Would that push into steel include EAF steelmakers?

“I think it will, absolutely,” Millsap responded.

Traditionally, most EAF steelmakers – think, for example, North Star Bluescope, Nucor, and Steel Dynamics Inc. (SDI) – are not unionized. They are often newer than integrated mills, located in less union-friendly regions, and their bonus and payout structures often give workers fewer incentives to organize.

With 70% of domestic steelmaking happening at EAFs – most of them long non-union – it’s hard to imagine how that push would play out. But if the post-2020 world has taught us anything, it’s the future can really throw you a curveball.

Finally, when asked if the continued operation of Granite City would be part of any U.S. Steel deal, Millsap said, “I certainly am hopeful for it.”

“Granite City is an old plant. But it can make money, it does make money, and we need to protect steelmaking,” he added.

Ethan Bernard

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