Vol. 73/No. 2      January 19, 2009

U.S. manufacturing activity fell to its lowest point since 1980, according to the Institute for Supply Management.

In the United Kingdom manufacturing dropped for the eighth consecutive month. In Sweden it plunged at the fastest rate in 14 years. Overall manufacturing in countries that use the euro dropped in December to the lowest level in the currency’s 11-year history.

Manufacturing fell to its lowest level since 1997 in Russia and in China it declined for the fifth straight month.

Toyota announced it will post an annual operating loss for the first time since it began reporting in 1941. The company will lay off thousands of temporary workers in Japan. Overall, Japan’s exports plummeted by 27 percent in November.

The drop in Japan was mirrored in other Asian countries, with exports in Thailand falling by 19 percent and exports from Taiwan by 23 percent. In South Korea, exports dropped by more than 17 percent in the last year.

Every industry surveyed in the United States reported a drop in production in December, except two, apparel and leather goods, which remained at the same level as November.

One of the most dramatic contractions is in the world steel industry, which is now reacting to plummeting auto sales, housing starts, and appliance purchases. About 57 percent of steel bought in the United States goes into construction or autos, according to the American Iron and Steel Institute; 13 percent goes into appliances and machinery.

U.S. steel companies were raking in record profits in the first nine months of 2008. But now the price of a ton of steel has dropped by half, according to the New York Times. Output has declined to 1 million tons a week from 2 million in August. U.S. mills are operating at 43 percent capacity.

The world’s largest steel company, ArcelorMittal, is closing two plants in the United States and axing 9,000 jobs worldwide. The company is shutting down its finished steel processing plant in Lackawanna, outside Buffalo, New York, and a similar plant in Hennepin, Illinois, eliminating 545 jobs. Both plants mainly produce for the auto industry.

U.S. Steel is idling its Great Lakes mill outside Detroit and its Granite City mill in Granite City, Illinois, as well as an iron ore mining and pelletizing facility in Keewatin, Minnesota. About 3,500 workers will be laid off. There is no date to reopen.

U.S. Steel is the largest employer in the town of Granite City. The third largest employer in town is Amsted Rail, a steel foundry. Amsted will lay off about half its workforce—363 workers—in February.

The Allegheny Ludlum plant in Midland, Pennsylvania, which produces stainless steel, was hiring as of last August. Since then orders dropped 50 percent below projections. Now all but 10 of the workers—who numbered 230—have been laid off.

Steel bosses are asking the White House to include them in the “economic stimulus” legislation that is supposed to contain infrastructure projects that would require steel. The CEO of Nucor Corporation, Daniel DiMicco, said he would lobby for “a recovery program that has in every provision a ‘buy America’ clause.”

As factory layoffs mount in the United States, Blacks are hit hardest. Unemployment for Blacks went up 2.8 percent in the last year, compared to a 2 percent rise in the population as whole.
 
 
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