ISG A fresh start for steel -- and its work force
These once laid-off Steelworkers are finding their place again at ISG.
CLEVELAND (AP) -- Even as machines roar jetlike sounds and the temperature climbs to near 1,400 degrees, laborers at an International Steel Group Inc. mill are smiling under their hard hats.
The sweat pouring from their brows, the coal-black grime under their fingernails are good things for workers who thought their steelmaking careers were over when bankrupt LTV Corp. closed, the latest in two decades of mills shuttered across the United States.
Workers like Eddie Reust, 50, of Cleveland, have experienced the rarity of being hired by a U.S. steelmaker when the industry is shrinking. The consolidation followed the industry collapse of the 1980s and the flood of cheaper foreign steel in the 1990s that threatened to end the nation's steelmaking dynasty.
"I didn't think we would ever make steel here again," said Reust, who had 29 1/2 years in when the LTV pink slip came three years ago.
He's one of some 12,000 ISG employees who got their jobs after the company bought bankrupt companies, shed retiree costs and consolidated several pricey steel operations into a few cost-effective ones. Most of the recalled workers were among the 55,000 Steelworkers nationwide who lost jobs during the collapse.
"I was devastated. I had worked 30-some years of my life, and all the sudden the doors were closed," said Donald Jenkins of South Highland, Ill., recalling the day he lost his LTV job.
Six months later, ISG restarted the East Chicago, Ind., plant just across the state line from where Jenkins lived, and the company wanted him back.
"It was the best call I ever took in my life," said Jenkins, who repairs machines used in the Indiana mill that makes steel for agricultural equipment, appliances, construction, automobiles and other products.
Gary Grimes was more than three decades into his career and six months from a pension when LTV shut down in Cleveland in 2001. The next year, he was called back to work at ISG's Cleveland hot strip mill, the part of the plant where freshly rolled steel is run through a bath of molten coating.
"They reopened with less people," Grimes said with some sadness. "But there were zero people when it was shut down."
Grimes now does several jobs at the mill where technology has changed much of the way steel is made and perfected. But the work is still physical with a lot of heavy lifting and welding, for example. The mill, though cleaner, is loud and hot as orange-glowing slabs constantly pass on giant rollers through to get steam baths of sorts.
A little history
The Richfield-based company bought LTV in 2002 and rose to become the nation's largest integrated steelmaker by buying and revamping operations in Ohio, Illinois, Indiana, West Virginia and Pennsylvania.
It shed the costs associated with more than 82,000 retirees and came up with a strategy to make steel cheaper with fewer workers, with whom profits are shared.
In late October, ISG found itself on the other end of a takeover bid when Dutch steelmaker Ispat International NV and LNM Holdings NV Now proposed a $4.5 billion merger. The combined group would be one of the largest steel companies in the world, operating under the name Mittal Steel Company NV. Owner Lakshmi Mittal said he does not plan layoffs.
Analysts say the deal would increase job protection for U.S. workers who have already seen the benefits of consolidation.
The United Steelworkers of America, which represents most ISG workers, also endorsed the proposal.
"Larger, stronger steel companies benefit our members and retirees. We want our members to work for companies that are able to meet their obligations to them, while having the ability to compete in the global steel market," said Leo Gerard, president of USWA International.
Ron Turnick couldn't help but be jittery when news of the merger broke, although he's been assured his job with ISG is safe. He headed for a towel factory two years ago when his 28-year job repairing electrical instruments disappeared.
"It was like, 'OK. Am I going to be looking for another job again?'" he said.
ISG says its growth will continue.
In August, the company announced it will expand its Cleveland Works plant with a hot-dipping line to make specialty steel for automakers, part of ISG's business that also produces steel for food cans, construction and other uses.
In September, the company restarted a second blast furnace at its newly acquired plant in West Virginia, recalling nearly 100 Steelworkers from the former Weirton Steel and raising employment to 1,900. In May, ISG reopened some of its west side Cleveland Works mill, bringing back 140 people.
ISG's more efficient model has since been copied by some of the company's largest competitors, including Pittsburgh's U.S. Steel Corp., which has worked with the union to cut 20 percent of its work force.
But only ISG has been able to recall so many workers because it has restarted long-cold operations.
"It's not like the steel industry is suddenly hiring people. We only replace through attrition," said U.S. Steel spokesman John Armstrong.
In Cleveland, the former LTV workers with the most seniority were hired first. ISG wanted experience over youth, a move the company says allowed it to restart its east side plant several months soon than anyone expected.
"We were all scared -- we were going to be in our 50s -- that they weren't going to call us back," Grimes, 54, said during a break at ISG's east side hot strip mill. "They told us, 'You guys know how to run this mill. We want you back.'"
Today, ISG employs about 1,500 of the 3,100 who were laid off by LTV in Cleveland. They have a combined 35,000 years of steelmaking experience, said Bill Brake, general manager of Cleveland Works.
"The fact that we were able to have an experienced work force come in and get behind the wheel again -- that's just made all the difference," he said.
It also meant some of the employees who shut down the blast furnaces were called back to restart them, including Turnick, 49, of Oberlin.
"Everybody there now is still the people who were there when we left, just less of us," Turnick said.
Steelworkers, grateful for the $15- to $20-an-hour jobs that have been saved, generally accept the new work rules and, because they share profits, appreciate the need to cut unnecessary costs.
Grimes, a union leader, said there are concerns, mainly about safety in older plants. But he said ISG has been responsive and workers respond to the style of managers who often buy them lunch or give surprise holiday bonuses.