Jones & Laughlin Steel Corp. dropped the other shoe on this ailing steel city today, announcing it will shut its Brier Hill steel mill and lay off 1,400 workers soon after Christmas.
The Jones & Laughlin announcement came less than 24 hours after U.S. Steel Corp. announced it would end steelmaking here and lay off 3,500 people as part of a nationwide cutback of 13,000 jobs.
The decisions by the two giant steelmakers will add nearly 5,000 steel workers to the unemployment rolls of Mahoning County, where there already are 8,500 people out of work and the unemployment rate is 6.3 percent.
The new layoffs could push the local unemployment rate to at least 10 percent, twice the national average.
The steel plant shutdowns also threatened to create a fiscal crisis for the entire community by drying up the biggest single source of tax revenues. The city of Youngstown collects more than $1 million a year in local income taxes on payrolls of the steel plants and collects nearly that much in property taxes.
But steel taxes are still a fraction of Youngstown's city budget. At the village of McDonald, steel taxes pay more than 70 percent of the $1.1 million a year local budget.
The layoff by Jones & Laughlin had been expected for nearly a year, but Youngstown had counted on keeping open the sprawling U.S. Steel Ohio Works across the street from the J&L plant.
U.S. Steel officials had promised to keep the Ohio and McDonald plants operating so long as they were profitable and both were still making money, officials of the United Steelworkers Union insisted today. The U.S. Steel plant is shut down this week for a one-week furlough. It will reopen next week, but the company will not say how long it will stay open. Union officials fear the shutdown will come early next year.
Jones & Laughlin siad it will start shutting its steelmaking operations here on Dec. 27 and will phase out the operation over the next few months. Jones & Laughlin will still have more than 3,000 employes in Youngstown after this shutdown.
The Jones & Laughlin announcement completes the dismantling of what in a steelmaking town.
Two years ago, the sprawling Campbell Works of Jones and Laughlin was shut, throwing 4,000 persons out of work. Many of those former steelworkers -- union officials say about 25 percent of them -- are still looking for work today.
Jones & Laughlin announced its decision after a meeting with local union officials this afternoon. The company cited "weakening market demand, continued high levels of imported steel and the high cost of open hearth steelmaking" in its decision to close the facilities.
U.S. Steel a day earlier blamed environmental regulations, low-priced steel imports and unfavorable federal tax rules for the closing of 16 of its facilities around the nation.
Youngstown steelworkers and members of a community group that tried unsucessfully to get federal help to keep the Campell works open met late in the afternoon to assess their strategy for fighting the latest layoffs.
They will begin by marching on U.S. Steel headquarters in Pitsburgh Friday morning.
Ed Mann, president of the Steel workers local whose members got their walking papers yesterday, said the Jones & Laughlin closing "will be an economic disaster for this community. It's going to dry up the city taxwise."
Mann said he believes his members will have few opportunities for finding new jobs in the Youngstown area. Beside the steel mills, the biggest local employer is General Motors' Lordstown assemblyy plant, which recently laid off 1,400 workers when van production was cut back.
Veteran union steelworkers now earn $18,000 and up per year, depending on their skill. The size of the unemployment benefits will depend on what federal programs are mobilized to help them. They could be eligible for up$250 a week in federal aid for two years, if the Labor Department decides they lost their jobs primarily because of foreign competition.
Three times in the past, the Labor Department has refused to qualify the U.S. Steel plant here for that aid, because there was no proof that imports caused the plant's problems.