JOHANNESBURG – ArcelorMittal is considering job cuts and restructuring to save costs in a challenging global steel market and recession at home, it said on Tuesday.
Job cuts are a thorny issue in South Africa were unemployment is at a 14-year high and key sectors of the recession-hit economy, such as trade and manufacturing, are struggling.
ArcelorMittal, which is majority-owned by top global producer ArcelorMittal, said it would explore several initiatives, including cost saving measures, assessing the profitability of various product lines and restructuring in the next six months.
“All options are being explored and the company has no option but to also review its staffing levels,” ArcelorMittal said in a statement, adding that it would first consider alternatives before any job cuts.
ArcelorMittal said it anticipated that more than 50 employees could be affected.
Its first-half losses deepened to 1.619 billion rand ($125.5 million) on higher costs for imported coking coal and iron ore, exchange rate volatility and continued weakening of the South African economy.
The steel maker is the latest company to consider job cuts following Sibanye Gold and Anglogold Ashanti, which could affect a total of around 15,900 employees.