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A D V A N C E D
M A T E R I A L S
&
P R O C E S S E S | J A N U A R Y
2 0 1 7
3 5
was the will of men who created you,
Youngstown, and it was the will of men
who destroyed you. In Youngstown, we
made steel. And you died too soon.”
USS closed its Fairless Works in
1991. That same year it also closed the
Baytown, Texas, plant that was only 20
years old. From 1980 to 1998, produc-
tion decreased from 17 million tons to
11 million and employees went from
150,000 to 20,000. By 1995, the remain-
ing major operations of USS included
the Edgar Thompson Works, Clairton
coke plant, the Irvin finishing mill in
Pittsburgh, the Gary Works, and its
operation in Fairfield, Ala.
By 1982, Bethlehem had closed
four of its plants—Bethlehem, Steelton,
Johnstown, and Lackawanna—and
lost over $1 billion, most of it in clos-
ing Lackawanna. Bethlehem had just
15,000 employees by 1999. However,
imported steel was not the only factor
in the decline of the integrated steel
industry in the 1990s. Another was the
inroads being made by the new mini-
mill industry.
MINIMILLS ANDMITTAL
The minimill industry that started
making lower grade bars, angles, and
reinforcing rods for concrete in 1970
had advanced to producing quality
sheet and structural beams by the
1990s. This new industry was a major
factor in Bethlehem’s decline. The com-
pany’s production decreased to nine
million tons while Nucor, the minimill
company, produced 10 million tons.
After nearly 80 years, Bethlehem was
no longer the second largest steel pro-
ducer in the country.
National Steel Corp., one of the
small steel companies that hadbeen suc-
cessful from its formation in 1929 until
the 1980s, began to lose momentum as
a result of poor management. The com-
pany filed for bankruptcy in 2002 and
was bought by USS for $1 billion.
In 2001, Bethlehem suddenly
demoted its chairman after only one
and a half years in office and hired a
turnaround specialist to run the com-
pany. He placed Bethlehem into bank-
ruptcy and the company lost $1.9 billion
that year. Out of the destruction, the
remaining assets were purchased in
bankruptcy court by Wilbur Ross and
added to his holdings in International
Steel Group (ISG). Bethlehem Steel—an
icon of American industry that made
everything from wire to armor plate to
large forgings, built battle ships, aircraft
carriers, cruisers, destroyers, landing
ships, and freighters, as well as con-
structed the Empire State Building and
Golden Gate Bridge—ceased to exist on
May 2, 2002.
In the wake of this decline, Ross’s
holdings grew to include the LTV plants
(the former J&L, YS&T, and Republic
Steel) and the Burns Harbor and Spar-
rows Point Works of Bethlehem Steel.
He improved operations by canceling
the union contracts in bankruptcy and
terminating thousands of employees.
By reducing the labor force and revok-
ing the benefits the union had won
during the previous 50 years, these
plants became profitable once again.
Several years later, Ross sold ISG to
Mittal Steel, a company whose largest
shareholder was Lakshmi Mittal.
Mittal is an Indian company with
worldwide holdings in steel produc-
tion, headquartered in Luxembourg. It
would later acquire Arcelor Steel, the
largest steel company in Europe, and
change the name to ArcelorMittal. With
owership of the integrated mills from
ISG, ArcelorMittal became the largest
steel producer in the U.S. at 22 million
tons capacity. It is also the largest steel
producer in the world, with 100 million
tons global capacity. After 100 years,
the biggest integrated steel producer in
the U.S. now has overseas ownership.
THE FATE OF THEWORKFORCE
The fate of Bethlehem along with
Youngstown Sheet and Tube, J&L,
Republic Steel, and many smaller inte-
grated steel companies destroyed most
of the remaining integrated steel com-
panies in the U.S. These companies left
tens of thousands of employees with
no jobs, no health insurance, pension
funds that had to be taken over by the
federal government, abandoned plants,
and cities such as Sparrows Point, Beth-
lehem, Johnstown, Pittsburgh, Lacka-
wanna, Youngstown, Gary, and South
Chicago losing up to half of their pop-
ulations. The devastation was epic and
the effects continue to ripple far into
the future.
For more information: Charles R.
Simcoe can be reache
gmail.com.
ArcelorMittal headquarters in Luxem-
bourg. Courtesy of Wikimedia Commons.
Lakshmi Mittal, chairman and CEO of
ArcelorMittal. Courtesy of Wikimedia
Commons.
Wilbur Ross, a turnaround specialist for
bankrupt companies, andPresident-elect
DonaldTrump’s choice for commerce secre-
tary. CourtesyofWikimediaCommons.